BSE Sensex(9424.24) and Nifty(2874.80) closed 8.6% and 7.3% up respectively last week. Inflation was at 5.64 v/s 5.60 last week. Crude oil was at 42$.Markets soar up from oversold territory on the news of $819 billion stimulus package being passed by U.S.House of Representatives. L&T expressed their interest to buy Satyam to Government of India. Fiedility bought 1.71 Cr. shares of Satyam from the open market. IMF reduced the growth forecast of India to 5.1% from 6.3% in 2009 .
Government announced the price cut of petrol and diesel by five Rs and two Rs. respectively. Reliance Industries got interim order from Bombay high court to sell KG Basin gas till final judgement which is expected by mid March. Support for Sensex is at 9000 and for Nifty 2740.Resistance for Sensex is at 9860 and Nifty is at 3000. Nifty put call ratio was 1.21.Nifty February 2700 put option added open interest. SAIL and RPL added open interest.
SBI and HPCL shaded open interest. Huge position was build up at BHEL February put option strike price 1290 and L&T February call option strike price 680.
Tactics for Future Option players.
1)Hindalco(48.95) Lot Size-1759 Shares
Buy one call option of February strike price 50@3.85 Rs.
Sell one call option of February strike price 55@2.00 Rs.
Premium .Paid=3.85*1759=6772.15 Rs.
Premium Received=2*1759=3518.00 Rs.
Net Premium Paid=6772.15-3518=3254.15 Rs.
Maximum Profit=55-50=5*1759=8795-3254.15=5540.85 Rs.
Maximum Loss=3254.15 Rs.
Break-even=51.85 Rs.
2)Petronet(37.35) February future-Lot Size 2200 shares.
Buy one lot February future @37.35
Sell one call option of Februay strike price 40@1.90 Rs.
Premium Received=1.90*2200=4180.00 Rs.
Max Profit==40-37.35=2.65*2200=5830.00+4180.00=10010.00 Rs.
Max loss=Unlimited.
Trading Idea
1)MARUTI(568.30)Buy this stock in decline and trade.
2)BPCL(391.95)Buy this stock in decline and trade.
Trend of Major Stocks
STOCK TREND Days WeeklyTrend MonthlyTrend
BHEL.NS Bearish 2 Falling Rising
ICICIBANK.NS Bulllish 4 Rising Rising
INFOSYSTC.NS Bulllish 4 Rising Falling
ITC.NS Bulllish 4 Rising Rising
MARUTI.NS Bulllish 2 Rising Rising
SBIN.NS Bulllish 4 Rising Rising
TATASTEEL.NS Bulllish 3 Rising Rising
TCS.NS Bulllish 4 Rising Rising
Technical indicators of major Stocks
MFI=Money Flow Index
RSI=Relative Strength Index
ADX=Directional Momentum Index
STOCK CLOSE MFI-21 RSI-14 ADX-14
BHEL.NS 1320.8 46.85 44.43 12.26
ICICIBANK.NS 416.25 46.88 50.06 17.28
INFOSYSTC.NS 1306.65 69.32 61.52 22.13
ITC.NS 180.1 66.4 63.01 12.11
MARUTI.NS 568.30 75.86 55.16 20.07
SBIN.NS 1151 48.65 47.82 28.48
TATASTEEL.NS 184.6 57.04 43.03 21.96
TCS.NS 511.6 54.13 52.31 10.09
Narendra Nainani is renowned technical analyst and stock market advisor of INDIA having experience of more than 26 years having excellent success ratio.Expert in Derivatives Products-Futures & Options,Intraday,Short Term ,Medium Term,Long Term,Portfolio Management,IPO & Mutual Fund Advisor.Covered regularly by E TV & Business Magazines like The Economic Revolution for Market views. Website narendranainani.blogspot.com.
Article Source: http://www.articledashboard.com/Article/Bullet-Advisory-Indian-Stocks-Weekly—-Markets-soar-up-from-oversold-territory-on-short-covering/720120
Sunday, February 15, 2009
Automated Trading - Money Machine by Jubair Ahmed
One major constraint for many traders is the time required to watch the market and execute trades. It can be difficult to be active in the market if you work and have a family. Watching the screen day and night is tiring even for professional traders. You could leave the screen for a moment, and miss a market move.
Also, it is difficult to stay objective and keep trading emotionless when it is in front of you all the time. What if there was a better way where your computer did the work?
In the last few years, technology has evolved to the point where your computer can monitor the market, make the trading decisions and execute the trades. Theoretically, you can simply leave your computer on and it will automatically sit there and make money for you - like a money machine in your home.
What is the reality, and how can you use automated trading technology?
There are two approaches - you can have your trading model running on your broker's system, or you can run it on your own PC. The benefit of it being on the broker's system is that it can directly connect to the execution and price systems. You can turn off your computer if you want. There are no issues with lost connections or power failures.
Running your automated trading model on your own PC potentially gives you more control over the operation of the model. You can change or tweak it at any time. If your model is proprietary, you can keep the details confidential more easily. However, you need very reliable hardware and a good Internet connection, uninterruptible power supply and data feed.
One broker offers an automated platform that runs on their systems but unfortunately you can only choose from a list of predefined systems. Some of these systems may be profitable in some circumstances, but it very much limits your options when you can't specify your own trading system.
In testing, it was found that this system opened multiple trades within a few seconds of each other. Unfortunately many of these trades were unprofitable.
Another automated platform is called MetaTrader. This runs on your own PC, and you can program your very own trading model. A number of brokers accept trades directly from MetaTrader. This gives you a lot of flexibility.
Of course, a profitable system is key. MetaTrader does give you access to historical data, and lets you backtest your model against the data. Expert Advisors (trading systems) are available, either for sale, or for free download from forums. Test these carefully before risking your own money. It is worth testing in real time against a demo account first.
In summary, automated trading does offer a lot of opportunities, especially those who don't want to watch the market 24 hours a day, but the results are only as good as the trading system. Make sure that your trading system is sound and profitable before automating it.
Jubair Ahmed is a senior writer for My Trading Help, a website about trading stocks, forex, futures and options. My Trading Help includes free helpful articles on financial markets, trading techniques, how to build a successful trading system and automated trading.
Article Source: http://www.articledashboard.com/Article/Automated-Trading---Money-Machine/720304
Also, it is difficult to stay objective and keep trading emotionless when it is in front of you all the time. What if there was a better way where your computer did the work?
In the last few years, technology has evolved to the point where your computer can monitor the market, make the trading decisions and execute the trades. Theoretically, you can simply leave your computer on and it will automatically sit there and make money for you - like a money machine in your home.
What is the reality, and how can you use automated trading technology?
There are two approaches - you can have your trading model running on your broker's system, or you can run it on your own PC. The benefit of it being on the broker's system is that it can directly connect to the execution and price systems. You can turn off your computer if you want. There are no issues with lost connections or power failures.
Running your automated trading model on your own PC potentially gives you more control over the operation of the model. You can change or tweak it at any time. If your model is proprietary, you can keep the details confidential more easily. However, you need very reliable hardware and a good Internet connection, uninterruptible power supply and data feed.
One broker offers an automated platform that runs on their systems but unfortunately you can only choose from a list of predefined systems. Some of these systems may be profitable in some circumstances, but it very much limits your options when you can't specify your own trading system.
In testing, it was found that this system opened multiple trades within a few seconds of each other. Unfortunately many of these trades were unprofitable.
Another automated platform is called MetaTrader. This runs on your own PC, and you can program your very own trading model. A number of brokers accept trades directly from MetaTrader. This gives you a lot of flexibility.
Of course, a profitable system is key. MetaTrader does give you access to historical data, and lets you backtest your model against the data. Expert Advisors (trading systems) are available, either for sale, or for free download from forums. Test these carefully before risking your own money. It is worth testing in real time against a demo account first.
In summary, automated trading does offer a lot of opportunities, especially those who don't want to watch the market 24 hours a day, but the results are only as good as the trading system. Make sure that your trading system is sound and profitable before automating it.
Jubair Ahmed is a senior writer for My Trading Help, a website about trading stocks, forex, futures and options. My Trading Help includes free helpful articles on financial markets, trading techniques, how to build a successful trading system and automated trading.
Article Source: http://www.articledashboard.com/Article/Automated-Trading---Money-Machine/720304
Winning Traders vs Losing Traders by Jubair Ahmed
There are only two types of traders - winners and losers. Most traders are losers. In fact government studies of traders show that between 90 and 95% end up losing their money.
What are the differences between the winners and the losers? Here are some of them:
Mindset
Mindset is the primary definer of winners and losers. Mindset encompasses independence, decisiveness, ability to handle both success and failure and responsibility for trading results.
The successful trader controls their mindset and attitude, transcending greed and fear, replacing this with the enjoyment of the challenge of trading. They are at peace with themselves, and have resolved internal conflicts.
Losing traders don't have this mental edge. They follow the herd rather than thinking independently, and want their broker to hold their hand. They always look for someone else to blame for their failures. Self sabotage spoils their chances of success. They may feel more comfortable staying on the same financial plane as their colleagues and friends.
Trading, with winning and losing a daily occurrence, quickly reveals your true character and exposes the limitations of your thinking. Make developing a winning mindset your highest priority.
Managing risk
There's an trading saying "There are old traders and there and bold traders, but there are few old, bold traders". Winning traders manage risk, losing traders don't.
A winning trader will limit their risk on each trade, use a model with a positive expectancy (long run positive return) and carefully manage capital. They are careful to diversify their risk, for example, by not opening positions that tend to be highly correlated.
In contrast, a losing trader will overtrade by taking positions too large for their capital, refuse to use stop losses and not use a tested and profitable trading system, often using "seat of the pants trading".
Using a system
Most winning traders have a working system. Not only that, they stick to their system, and have confidence in it, refusing to second guess it.
Losing traders either don't have a system, don't have a system that works, or don't have any confidence in their system and constantly override it, or stop using it after a few losses. Sometimes, they will spend $79.95 and buy a system cobbled together by someone else in the vain hope that it will be a short cut to riches without need for any personal effort. Of course, that is rarely successful.
Successful traders don't just buy a system and hope that it will work. They develop a system that reflects their own views of the market and risk tolerance, and extensively back test it themselves. This gives the winning trader a lot of confidence about the performance of the system under various market conditions.
A final note
Winning traders have an an exciting opportunity to build substantial wealth. To be one, you need a systematic approach to trading, typically by developing your own system. There are no short cuts to success, so you will need to read widely and critically, and work on your trading psychology.
We wish you successful trading.
Jubair Ahmed is a senior writer for My Trading Help, a website about trading stocks, forex, futures and options. My Trading Help includes free helpful articles on trading techniques, becoming a successful trader, how to build a successful trading system and automated trading.
Article Source: http://www.articledashboard.com/Article/Winning-Traders-vs-Losing-Traders/720328
What are the differences between the winners and the losers? Here are some of them:
Mindset
Mindset is the primary definer of winners and losers. Mindset encompasses independence, decisiveness, ability to handle both success and failure and responsibility for trading results.
The successful trader controls their mindset and attitude, transcending greed and fear, replacing this with the enjoyment of the challenge of trading. They are at peace with themselves, and have resolved internal conflicts.
Losing traders don't have this mental edge. They follow the herd rather than thinking independently, and want their broker to hold their hand. They always look for someone else to blame for their failures. Self sabotage spoils their chances of success. They may feel more comfortable staying on the same financial plane as their colleagues and friends.
Trading, with winning and losing a daily occurrence, quickly reveals your true character and exposes the limitations of your thinking. Make developing a winning mindset your highest priority.
Managing risk
There's an trading saying "There are old traders and there and bold traders, but there are few old, bold traders". Winning traders manage risk, losing traders don't.
A winning trader will limit their risk on each trade, use a model with a positive expectancy (long run positive return) and carefully manage capital. They are careful to diversify their risk, for example, by not opening positions that tend to be highly correlated.
In contrast, a losing trader will overtrade by taking positions too large for their capital, refuse to use stop losses and not use a tested and profitable trading system, often using "seat of the pants trading".
Using a system
Most winning traders have a working system. Not only that, they stick to their system, and have confidence in it, refusing to second guess it.
Losing traders either don't have a system, don't have a system that works, or don't have any confidence in their system and constantly override it, or stop using it after a few losses. Sometimes, they will spend $79.95 and buy a system cobbled together by someone else in the vain hope that it will be a short cut to riches without need for any personal effort. Of course, that is rarely successful.
Successful traders don't just buy a system and hope that it will work. They develop a system that reflects their own views of the market and risk tolerance, and extensively back test it themselves. This gives the winning trader a lot of confidence about the performance of the system under various market conditions.
A final note
Winning traders have an an exciting opportunity to build substantial wealth. To be one, you need a systematic approach to trading, typically by developing your own system. There are no short cuts to success, so you will need to read widely and critically, and work on your trading psychology.
We wish you successful trading.
Jubair Ahmed is a senior writer for My Trading Help, a website about trading stocks, forex, futures and options. My Trading Help includes free helpful articles on trading techniques, becoming a successful trader, how to build a successful trading system and automated trading.
Article Source: http://www.articledashboard.com/Article/Winning-Traders-vs-Losing-Traders/720328
Stock Market Basics - What is Online Stock Trading? by J.J. Yong
If you would like to have your stock order be entered right away with just a few clicks on the computer mouse, then you should choose online stock trading to accomplish this particular task. Compared with the traditional method, you do not have to communicate with your broker in which basically delay the process of your order.
The advantages of choosing this method are:
You can take your stock pick and do the ordering yourself.
You will be able to save huge amount of money and time - In this method, you can save your money from paying high middleman commission.
Permission is not necessary because as long as you are online, you can buy and sell stock without needing to ask permission. Basically, you can do everything as early as you want it done to keep your profit growing.
Although this particular transaction is not applicable to all brokerage firms; however, most of the brokerage firms allow an overnight order, which will be entered the following business day.
Bear on your mind that online trading has its own disadvantage you need to think through. For instance, this particular trading requires market research and stock movement.
Then, what should I do about it?
Perform an extensive learning and market analysis on your own without the aid of a broker. It is important that you are aware of the latest market news and potential stock picks.
If you are not the type of businessperson who rely so much on opinion from stock market experts, then the downside of online trading does not really matter.
You can always opt to listen and base your decisions to the brokers’ opinion and advice, but you need to depend on your own knowledge and research in order to improve your earnings from your stocks in the market.
For more information about online stock trading and stock market basics, visit OnlineStockTradingBasics.com
Article Source: http://www.articledashboard.com/Article/Stock-Market-Basics---What-is-Online-Stock-Trading?/720447
The advantages of choosing this method are:
You can take your stock pick and do the ordering yourself.
You will be able to save huge amount of money and time - In this method, you can save your money from paying high middleman commission.
Permission is not necessary because as long as you are online, you can buy and sell stock without needing to ask permission. Basically, you can do everything as early as you want it done to keep your profit growing.
Although this particular transaction is not applicable to all brokerage firms; however, most of the brokerage firms allow an overnight order, which will be entered the following business day.
Bear on your mind that online trading has its own disadvantage you need to think through. For instance, this particular trading requires market research and stock movement.
Then, what should I do about it?
Perform an extensive learning and market analysis on your own without the aid of a broker. It is important that you are aware of the latest market news and potential stock picks.
If you are not the type of businessperson who rely so much on opinion from stock market experts, then the downside of online trading does not really matter.
You can always opt to listen and base your decisions to the brokers’ opinion and advice, but you need to depend on your own knowledge and research in order to improve your earnings from your stocks in the market.
For more information about online stock trading and stock market basics, visit OnlineStockTradingBasics.com
Article Source: http://www.articledashboard.com/Article/Stock-Market-Basics---What-is-Online-Stock-Trading?/720447
Lifestyle of a Trader by Jubair Ahmed
Most people who decide to become traders - stock trading, futures trading or forex trading, want to become traders for lifestyle reasons. What are the main lifestyle benefits of being a trader , and how can you expect to live once you become a full time trader?
Why do many would be traders, intelligent, well educated people who understand the mechanics of the financial markets fail in their trading?
There are a few aspects of lifestyle that are unique to traders. Firstly, trading does not involve answering emails, working in an office, corporate politics, regular working hours or any of the things associated with corporate life, or employment. There is little in common with ordinary employment.
Secondly, successful traders can be extremely wealthy. Their income is not restricted to the amount they can sell, how hard they work, or their position on the corporate ladder.
No matter how hard you work in most jobs, you won't be driving a Ferrari. Paul Tudor Jones, a top trader made more than $700 million in just one year. In trading, the trappings of substantial wealth are within reach. If you've ever wanted to help out your parents, or fund a cause you believe in, money is the key. Trading is all about making money.
Trading can occur wherever you have a computer and an Internet connection. You can trade from virtually anywhere on the planet. If you want to sail the Caribbean on a yacht and trade, you can do so. You don't need to be at a certain place at a certain time, or commute to the office or factory. Trading gives you the gift of time with your family and flexibility.
Whilst trading offers an enviable lifestyle, unfortunately most new traders will never be successful. Why is this?
Well trading is the ultimate expression of capitalism - traders meeting in a market place. There are no distortions. Nepotism means nothing. Charm and appearance are irrelevant. All the reasons that people can make it in employment whilst being useless are no longer applicable.
More than 95% of would be traders fail. They don't have a trading plan, or a profitable system. They lack discipline or suffer internal conflicts. They chase after scams or won't put in the work to learn about the market, forgetting how hard it is to learn any new job. Sometimes they spend all their time on forums, following the herd, or looking for a broker to hold their hands. They won't manage risks.
Perhaps, they don't want to succeed, and are more comfortable relating to people on their own financial plane. The losing trader has not yet overcome the obstacles between them and success.
The 5% of successful traders want to be profitable, but their primary drive is to succeed by fulfilling their true potential in the market place. The successful trader stands out among those who criticise him on the way by achieving the peak of what most people can only aspire to - true independence and self mastery after overcoming many hurdles.
Jubair Ahmed is a senior writer for My Trading Help, a website about trading stocks, forex, futures and options. My Trading Help includes free helpful articles on tips for traders, trading techniques, how to build a successful trading system and automated trading.
Article Source: http://www.articledashboard.com/Article/Lifestyle-of-a-Trader/720342
Why do many would be traders, intelligent, well educated people who understand the mechanics of the financial markets fail in their trading?
There are a few aspects of lifestyle that are unique to traders. Firstly, trading does not involve answering emails, working in an office, corporate politics, regular working hours or any of the things associated with corporate life, or employment. There is little in common with ordinary employment.
Secondly, successful traders can be extremely wealthy. Their income is not restricted to the amount they can sell, how hard they work, or their position on the corporate ladder.
No matter how hard you work in most jobs, you won't be driving a Ferrari. Paul Tudor Jones, a top trader made more than $700 million in just one year. In trading, the trappings of substantial wealth are within reach. If you've ever wanted to help out your parents, or fund a cause you believe in, money is the key. Trading is all about making money.
Trading can occur wherever you have a computer and an Internet connection. You can trade from virtually anywhere on the planet. If you want to sail the Caribbean on a yacht and trade, you can do so. You don't need to be at a certain place at a certain time, or commute to the office or factory. Trading gives you the gift of time with your family and flexibility.
Whilst trading offers an enviable lifestyle, unfortunately most new traders will never be successful. Why is this?
Well trading is the ultimate expression of capitalism - traders meeting in a market place. There are no distortions. Nepotism means nothing. Charm and appearance are irrelevant. All the reasons that people can make it in employment whilst being useless are no longer applicable.
More than 95% of would be traders fail. They don't have a trading plan, or a profitable system. They lack discipline or suffer internal conflicts. They chase after scams or won't put in the work to learn about the market, forgetting how hard it is to learn any new job. Sometimes they spend all their time on forums, following the herd, or looking for a broker to hold their hands. They won't manage risks.
Perhaps, they don't want to succeed, and are more comfortable relating to people on their own financial plane. The losing trader has not yet overcome the obstacles between them and success.
The 5% of successful traders want to be profitable, but their primary drive is to succeed by fulfilling their true potential in the market place. The successful trader stands out among those who criticise him on the way by achieving the peak of what most people can only aspire to - true independence and self mastery after overcoming many hurdles.
Jubair Ahmed is a senior writer for My Trading Help, a website about trading stocks, forex, futures and options. My Trading Help includes free helpful articles on tips for traders, trading techniques, how to build a successful trading system and automated trading.
Article Source: http://www.articledashboard.com/Article/Lifestyle-of-a-Trader/720342
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