SBI

SBI: According to Elliot Wave

The worst case scenario for SBI: it drops to 1500 and begin its next Bull phase.If it stays below 1500 for couple of months then we may be headed for a great risk in India's growth story.

How much Money did I lose in Dollar Rupee Trade?

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Dollar Rupee Chart from Jan-2010 onwards

Cut your losing positions and let the winners run,One eventually makes money at the end.

Disclosure:Currently I have short positions on Nifty and net 65% cash in my portfolio.

Gold

Gold (2009-Till date)(Click the image to enlarge)

Above is the chart of Gold from 2009 onward. I have made it smoother by drawing straight lines.If you see gold is moving as a step up from the beginning of 2009 and the up move will continue till the starting point of step up is broken which is currently at 1460$

I believe no one knows where the gold is headed but these patterns help you to enter and be with the up move till it lasts.So if you wanna buy you can buy and hold with the condition that you will sell gold if it goes below 1460 $ which is the starting point of current step up.

So if we buy at current levels the above strategy is useful because with losing only 300$ you can be a part of gold up move which could be 500 or 2000 $ or anything.Also if gold goes down from here by paying only 300$ you will be getting out of Gold knowingly gold could go much lower from here.

I believe many people are getting interested in Gold currently due to recent up move.You can't make big money in something when everybody around you is interested in that.Just think of a Indian Stock Market in late 2007,everybody was interested in stocks and people made some money before getting stuck in the big down move.

The big money is made in buying something only when no one is interested in even talking about it one such example could be be stocks at current levels.

SBI a Good Buy for Long Term at current Levels

State Bank of India (Click the image to enlarge)

SBI appears to have completed a 3 wave correction pattern or there is another possibility that it goes to 1900 levels to complete the correction.It may begin new uptrend very soon according to Elliot Wave theory.

Dollar Rupee Chart

Identify a triangle in the Dollar Rupee chart from Apr 2010 - Till date.

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Below is the descending triangle in Dollar Rupee chart.

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The triangle pattern tells that a big move is coming very soon as the triangle is ending.The prices will move out of this triangle and move rapidly in one direction because the compression always lead to expansion in stock market too. A descending triangle has the nature of breaking on the downside which means its highly probable but not for sure.

The other possibility is it breaks on the upside and remain in the range of 44-50 in coming time.

What is an Initial Public Offer(IPO)? How much money one can make in an IPO?

Definition of IPO?

An initial public offering, or IPO, is the first sale of stock by a company to the public. A company can raise money by issuing either debt or equity. If the company has never issued equity to the public, it's known as an IPO.

Statistics

Below are the statistics for the performance of last year IPO's in Indian Stock Market and my performance.

Number of IPO's from Mar 2010 to Mar 2011- 60

Number of IPO's Currently trading below their issue price - 44

Number of IPO's currently trading above their issue Price- 16

My Investments and Returns

Number of IPO's from Mar 2010 to Mar 2011- 60

Number of IPO's my company applied for - 21

Number of IPO's in which we made money - 18

Number of IPO's in which we lost money - 3

My total Return on Investment - 33%

I have made around 1.94 lacs during that period from IPO's by investing 6 lacs.

Scenario: If the invested amount is Rupees 4 lacs or $10000 the return on investment will be Rs 1.32 lac or $3300 (assuming the previous performance is repeated).So by making 20-25 transactions a year we can generate $3300 cash.

Below is the link for all the trades that I did in one of my accounts

https://spreadsheets.google.com/ccc?key=0AuNgWOjkT8i4dEx3NWNUdS03Wk1ISmF3SW5HalFyc1E&hl=en&authkey=CIn1-akF

Disclosure:I can help people in investing in IPO's.I assure I will apply for around 8 lacs in an IPO that I am recommending.

References:

http://www.investopedia.com/university/ipo/ipo.asp

My Recent Investments

I have made 3 Investments recently as shown below.

DCM - Invested Price 78 Current Market Price 78

Hanung Toys- Invested Price 207 Current Market Price 226

Glodyne Technoserve- Invested Price 562 Current Market Price 678

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The criteria for these investments is explained below.

1.The above specified stocks are the best performing stocks in the market for last 2 years as they have multiplied around 10-12 times from the lows made in March 2009.

2.Stocks that outperform the market continue this trend till the bull market is over.

3.These stocks have seen a sharp correction recently and has provided good entry opportunities.

4. All these stocks have retraced 61.8% of there upmove as shown in the charts and According to Elliot wave theory these stocks have moved up in 5 waves in last 2 years and now corrected in 3 waves. So it has completed 2 waves i.e one wave up and one wave down and we can expect 3rd wave of the 5 Elliot waves beginning very soon.

5.From risk reward prospective these stocks have given a good entry point as they have already fallen 50-60% from the top and we can expect up move beginning very soon.

Disclosure:These are my views which can be right or wrong and I am not responsible for any profit or loss incurred with the above specified information.