Home > Market View, NIFTY Strategy > Are you waiting for market correction?

Are you waiting for market correction?

Monday, October 15, 2007 Leave a comment Go to comments

Today was a real bad day for the bears and those who are on the sidelines. The stocks are moving so fast that it is nothing short of big surprise!

I had recommended a stock named Apollo Sindhoori Capital to some of my clients for a short term trading. The stock was trading at 234 some two days back and now the stock has closed like 320 in two days flat!This is like 35-40% in two days.

Now if you wait to enter such stocks, you just miss the bus. Just like today I missed a stock called Subhash Projects by a rupee or two. I put in a limit order in the morning only to find that I missed the stock by two bucks and the stock hit an upper circuit of 20%! You can imagine how I might be feeling.

This market is not for the faint hearted. When a stock like SAIL moves up 17% in a day, you can imagine the demand supply mismatches. So I am not surprised to see a liquid stock like Punj Lloyd move up by 12% in a day.

I do not know the reason for these moves but all I know is that smart traders are making tons of money. Such parabolic moves on the stocks usually end up in sharp corrections but it is next to impossible to time that correction. Also, I feel many intelligent people have missed these moves and scratching their heads to “understand” or “explain” the moves.

Whats happening is simple- Those who have missed the bus don’t have the guts to venture now. Those are short continue to short more as they are feeding on hope. Those who are long are utilizing their profits to buy more . They are getting greedy with their profits and trying to get maximum juice out of their positions.

What are you doing in these markets? Which camp are you in- Hope, fear or greed?

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  1. Tuesday, October 16, 2007 at 9:21 pm

    If you are bearish you should have bought more puts than covering some of them-isn’t it?

    I had some specific targets as per my Risk Model (volatility VIX is a main factor in the equation) and that made me take money off the table.

    There is also the “pin risk” that I need to worry about. Gamma is not looking good either.

  2. jk
    Tuesday, October 16, 2007 at 9:12 pm

    sage its difficult to stay calm
    we are not SAGE but ordinary humans
    learners ,

    learning from u and others

    i am still not satisfied u see its difficult to explain urselves as when losses will come they become ur liability and no one else to blame

  3. sagecapital
    Tuesday, October 16, 2007 at 2:44 pm

    If you are bearish you should have bought more puts than covering some of them-isn’t it? Markets are still expensive and global cues still shaky.

  4. Navs
    Tuesday, October 16, 2007 at 2:16 pm

    Yes, I do have a bearish view on the market. Fundamentally, PEs are stretched. Global Cues are becoming a bit shaky from yesterday.

    I covered 20% of my PUTs today. I will leave the rest for a while 😉

  5. ashish ji
    Tuesday, October 16, 2007 at 12:07 pm

    HOW much money requird to manipuate mrket? CAN ONE FII BRING MARKET DOWN???? or ONLY A GROUP?
    FII are all americans??>> how to see all FII in market?

  6. sagecapital
    Tuesday, October 16, 2007 at 11:53 am

    JK- This market has surprised many of the participants who hold that view. Ask people went short on NIFTY at 4500 or those who booked profits at 4500?
    As I aid before, this market shall correct but when?
    Also assume that you book profits at 4500 and markets go to 6500 and then correct back to say 5500, you might have still missed out on 1000 points!

  7. jk
    Tuesday, October 16, 2007 at 11:25 am

    I STILL HOLD MY STAND “WHATEVER GOES UP SUPERFAST HAS TOCOME DOWN SUPERFAST”

    AND THIS TIME DONT BE SURPRISED TO SEE DOWN OF 1500 POINTS IN TWO DAYS FLAT

  8. sagecapital
    Tuesday, October 16, 2007 at 10:42 am

    Navs- What was your basis for buying puts? Do you have a bearish view on the market?

  9. Monday, October 15, 2007 at 10:45 pm

    I have bought 1000 contracts of 5200 PUTs (NIFTY)

    I hope I make a good bounty tomorrow so that I can proceed for my christmas holidays as planned.

    US is weak today so that will reflect tomorrow.
    (tcs and ifci ruined my party a bit….but thats ok)

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