Open letter to all Bears !

[raosrinivas]

From your post, I can say the methods you use are:
1) Based on hindsight, interpretation rather than a systematized set up.
2) On stressing that the moving average works in trending markets and does not work in a trendless markets paves way for another assumption - the need to identify trending and trendless markets.

Consider prayer as a cure to diseases. It depends upon (they say) the priest who prays, the faith of the follower etc etc. It is very easy to blame the failure of the prayer to cure the disease by blaming it on the lack of faith in the diseased. Compare that with tested medicines, which work for a specific problem irrespective human biases?


Even the dentist will not survive long with flawed tools.



When did I propose buy-hold? I simply view it as the benchmark to a trend following system.

About working on hindsight, only time will tell.

If i had a financial analysis company, i would definitely hire oxy, he is the best tool you could use.

 

[ratan jain]

And I thought Oxy was human..... I just came to know he is a tool

 

[yuvrajjj]

of late i find a lot of doom sayers in traderji , just one simple question can anyone kindly also post their logic(let charts do all the talking) behind such bearishness ... its very easy to get carried away when the market keeps going down , as is the case on the way up aswell ... i keep hearing targets of 3700 , 3800 on the nifty when even the uptrend in the weekly which started in 2006 has not been broken (this tl might be broken on monday but the point is it has not broken yet) ..also i heard someone in CNBC GIVING FOUR DIGIT targets for sensex.
One more question ,where was the bearishnesses of you guys in the first half of jan08 ?...when you dont have to ability to identify an impending crash how come you guys suddenly have to ability to set levels for nifty and sensex ?.
Enc. nifty weekly and hourly

Thanx for bringing something new to our attention.

 

[raosrinivas]

oxy,

let me know if you know of any good strategy (system) that . you could use use variables it should include

Buy criteria
P/E >
PEG>
15SMA>

Sell criteria
...same here

please use basic variables/instead of derived calculations(because i need to input this into a software)

thanks
Srinivas

 

[aca_trader]

But fighting with the trend can make us nowhere.

regards
gk

This brings us to an important point, what the trend is and how is it to be measured?

First of all, Without a periodicity there is no meaning of trend. The markets may be in different trends in different time frames.
Currently NIFTY is in Uptrend on Monthly chart while it's in downtrend on Weekly/Daily Chart. Secondly, while price pivots are very good tool to understand trends, Trendlines are also a very effective method of gauging the trend.

We all hear that a trend is your friend but here is a different quote from somebody whose trend-following methods generate per annum returns that are double of the returns generated by such household names like Buffet & Soros. "Trend is your friend except when it's about to bend." - Ed Seykota

So another question which arises in mind is, "Why trends change and can we identify the price levels where they are about to change?"

In a market, there are always various participants who interact among themselves. However, the time horizon of all the traders is not in sync. Some of the traders may have a short term horizon while some other group of traders may be having varying degrees of long term view. Changes in short term trends take place when the long-term players jump into fray and overpower the buying/selling pressure of short-term traders.
Thus, if we can identify the levels where short term trend is likely to bend in favour of long-term trend, we can have a very low risk entry in the direction of long-term trend.

From our understanding of charts, we all are aware that market dynamics are such that orders (buy & sell) tend to cluster around a trendline. Thus, a long-term trendline can be identified as a poential point of reversal of the short-term trend and appropriate low-risk entries can be be taken in the direction of long-term trend. This is what is called "Buying on Dips" or "Selling on Rally".

Now in my understanding, by pointing out the weekly & monthly charts, Rajaram is trying to go with the trend instead of fighting the trend. Ofcourse, on Sensex, the weekly trendline was violated on friday and the monthly trendline has also been crossed on a running bar basis but NIFTY is still maintaining those levels and it'll be a very good long-risk buying opportunity ( for the people who did not go long today) by buying above the high of today and keeping today's low as stop. An additional factor supporting the decision is the Key Reversal bar on Daily Chart.

Various charts attached.

Regards,
--Ashish

Canveat:- Watch out the monthly/long-term weekly trendline of sensex. If a rally comes, it may terminate after retest of this particular trendline.

 

[aca_trader]

my logic "long term stock market will trace gdp growth" give 10% each year

2004 6000 600 6600
2005 6600 660 7260
2006 7260 726 7986
2007 7986 798.6 8784.6
2008 8784.6 878.46 9663.06


now what is your logic ?


thanks
Srinivas

Stock Market is a leading and not a lagging indicator. Stock market performance,at an average, lead the economic indicators by 1 year.

 

[aca_trader]

Oops! Just after making the couple of posts, I read the entire thread and it appears that much blood has flown under the bridge since the time thread was started. In case, my replies hurt sentiments, I apologise beforehand and am willing to move the posts somewhere else if need be.

BTW, calm down guys!. Disagreement among wise people is much necessary for innovation and value addition.

Best Regards,
--Ashish

 

[rajaram.dilipkumar]

Oops! Just after making the couple of posts, I read the entire thread and it appears that much blood has flown under the bridge since the time thread was started. In case, my replies hurt sentiments, I apologise beforehand and am willing to move the posts somewhere else if need be.

BTW, calm down guys!. Disagreement among wise people is much necessary for innovation and value addition.

Best Regards,
--Ashish

no need to move .......let it stay here only and no need to apologize you said nothing wrong

 

[oxusmorouz]

oxy,

let me know if you know of any good strategy (system) that . you could use use variables it should include

Buy criteria
P/E >
PEG>
15SMA>

Sell criteria
...same here

please use basic variables/instead of derived calculations(because i need to input this into a software)

thanks
Srinivas

Hello Srinivas,
I'm merely a student of the market and am no authority in the field of system development. Also, I have never operated with fundamental data before. Perhaps asking a specialist would be a great idea.
Good luck!

 

[rajaram.dilipkumar]

http://www.traderji.com/162522-post45.html

good post