Tuesday, February 23, 2010

Nifty & Sensex view and Outlook of Indian Market on budget week


Nifty & Sensex is trading between 89EDMA & 200EDMA as a range in the last 19trading days waiting for a firm direction or trend which is missing and more sideways move is seen. Nifty 89EDMA is 4934 & 200EDMA is 4671
Sensex 89EDMA is 16537 & 200EDMA is 15639
Adv-Dec ratio from 1st of January till 22nd February= BSE 2968 Issues Adv-1193 Dec 1759 Unchanged 16 & NSE 1348 Issues Adv-463 Dec 874 Unchanged 11
24th February Rail Budget
25th February Economic survey
26th February General Budget and GDP data and after which 3days of holiday can keep market flat for the week.
Jesse Livemore has said, "there are days I will be long and days I will be short and there will be days I will go fishing”. 

This market is becoming so narrow and low volume affair in cash segment that traders are not making money. The Adv-Dec ratio has turned very negative if we check from start of year and in spite of indices being range-bound, individual stocks have fallen heavily. 
As per previous view, (Previous View http://akprabhakar.blogspot.com/2010/02/nifty-sensex-view-and-outlook-of-indian.html) Nifty fell slightly short of our 4950 target but the needed momentum is not present to take rally higher with vigour. Many events are scheduled this week and newsflow can give way to sharp moves either side. Volumes have already dropped to below Rs 10,000Cr in NSE cash itself which is lowest in nearly a year and with such low volume no trading position would be so profitable. This is a caution to short-term traders and better to just watch what is happening than risk on low volume markets. More quotes from Jesse Livermore will only clarify in a better way:
  • When the market goes against you, you hope that every day will be the last day - and you lose more than you should had you not listened to hope. And when the market goes your way, you become fearful that the next day will take away your profit and you get out - too soon. The successful trader has to fight these two deep-seated instincts.
  • The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the getrich- quick  adventurer. They will die poor.

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