Archive for February, 2012

DOW @ 14,000

Whether you understand technical analysis or not, it is very easy to understand the psychology of a resistance and support. It’s like a battle field. Resistances are supply points while supports are demand points. When supply points are overcome, the buyers overcome the sellers. This is positive (and vice versa.). This simple aspect attains more significance when the supply points are more than 10 years old. Markets are celebrating DOW 13,000 and even if this seems insignificant to the bears they should understand that the decade long supply point is now 8% away. Whenever that level breaks, all bullishness is going to break loose. Let’s see how much MAR can cause a real secular reversal. For us dips are marginal and accumulation opportunities. We wrote about it first in the Dow illusion on 4 Dec 2011. When we said Dow is headed higher and don’t let the dips trip you.

You can also download the report from our Reuters Store

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage Global: Dow 30 components, Global Indices, ETF SPDRS, Commodities

Dan-Andrei Rusu graduated in 2005 the Faculty of Economics Cluj-Napoca, “Dimitrie Cantemir” University. In the same year he joined BT Securities as a financial analyst. He is currently the Head of Research at BT Securities and a speaker with Romanian Brokers’ Association. He is an MTA (Market Technicians Association, New York) affiliate and cleared CMT level 1 exam. He is a contributing columnist for Orpheus Capitals for the ALPHA GLOBAL INDICES.


The Balaton Time


I revisited a friend at his Balaton lake house last weekend. Balaton is the largest lake in Central Europe also known as the Hungarian sea. Just 500 kilometers away and the weather was warmer than the cold snow packed Cluj. I had the sun, the view and more than a stack of books at his lakeside house. And as chance had to have it, next to Taleb’s signed copy of Black Swan was a book, ‘Riding the waves of culture’ by Fons Trompenaars. The book had a complete chapter on Time. This is the chapter abstract with my interpretation for you.

Culturally we either think of time sequentially as a series of passing events or synchronously with interrelated past, present and future. The ideas about the future and memories of the past both shape the present action. Time can be legitimately conceived of as a line of sequential events passing us at regular intervals. Or as cyclical and repetitive, compressing past, present and future by what these have in common, seasons and rhythms.

In the Greek myth the Sphinx, a monster with the face of a woman, the body of a lion and the wings of a bird, asked all wayfarers on the road to Thebes, ” What creature is it that walks on four legs in the morning, two legs at noonday and three legs in the evening?” Those unable to answer she ate. Oedipus, however answered “man” and the Sphinx committed suicide. He had grasped that this riddle was a metaphor for time. Four legs was a child crawling, two legs the adult and three legs and old person leaning on a stick. By thinking in a longer sequence about time, the riddle was solved.

How a culture thinks of time helps it interpret and find meaning in life. Even our conception of time is strongly affected by culture because time is an idea rather than an object. Emile Durkheim, the French sociologist, saw it as a social construct enabling members…

To read the complete article visit Business Standard.


Beautiful DRL Jiseki

 

TICKS UPDATE: 29.02.12 REDDY
The beautiful Jiseki helped you capture most of the upside from 2009. Grey area was the buy signal. Now at 90, the same Jiseki is suggest caution.

To benefit from our TICKS intra-day updates on ALPHA trends and signals mail us for subscription details.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage India: CNX100 traded stocks and Indian Indices.

Michesan Anna-Maria, discovered her interest of markets immediately after completing her graduate studies in Economics. She followed it up with post graduate studies in corporate finance. A host of research work in behavioral finance, option strategies and quantifying market sentiment followed. Anna covers Indian equity and combines Elliott, Time Fractals and Time Analytics to deliver accuracy across time frames.


The Auto March

 

It’s not a question whether BSEAUTO is in a continued multi month upside, the question is how soon or where it’s going to bottom. A Nifty 8,000 view can’t happen till BSEAUTO participates. First because it’s an early economic sector. Second because economic growth is connected to discretionary consumption sector. And third because when a sector has to underperform, it falls, it does not just stay there. BSEAUTO’s sideways stagnating move suggests consolidation rather than distribution.

To read the auto special mail us for subscription details or buy the latest ALPHA from our Reuters e store.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage India: CNX100 traded stocks and Indian Indices.

Michesan Anna-Maria, discovered her interest of markets immediately after completing her graduate studies in Economics. She followed it up with post graduate studies in corporate finance. A host of research work in behavioral finance, option strategies and quantifying market sentiment followed. Anna covers Indian equity and combines Elliott, Time Fractals and Time Analytics to deliver accuracy across time frames.


Investing with Time and Performance Cycles


The Correlation Hedge

 

We carried for you short ideas and long ideas. It may seem strange or coincident but both the list of stocks delivered vs. Nifty. Now our long ideas are more intermediate in nature. And since we don’t have spot instruments to short, the short signal ideas are leveraged, sharp stopped and minor (few days) in nature.

Today we have created a new innovation for you. The reason we call it innovation is because the idea is built on Jiseki and statistics. What is the innovation? Considering our long ideas are intermediate (multi week) and primary (multi month) in nature, we still plan to hold the long ideas. Now either we can hold them actively or passively. Buy and hold is the passive choice where long ideas should outperform Nifty. On the other hand we can actively and dynamically hedge the long ideas portfolio.

Hedging (avoid our long portfolio losing value) is always a tricky exercise. How have we made it simpler for you? We looked for the best positive and worst negatively correlated ideas vs. our long idea components and then we tested the pairs. We got the best results in the following positively correlated intermarket pair components…

This pairing approach can be used to not only selectively hedge a long only portfolio but also deliver positive pair results during the hedge period.

To read more about our JISEKI Rankings, Indices, Signals and queries mail us today.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Avinash Barnwal is Master of Science in Statistics and Informatics from IIT Kharagpur. He has worked on human response time at Department of Psychology, University of Amsterdam.  Avinash is a Quantitative Analyst at Orpheus developing money management solutions and building statistical models to address temporal challenges.


The Rupee view

1) What is the view on INR?
2) What is the INR connection with NIFTY?
3) What are the key levels?
4) Is the overall India outlook view bullish or bearish?

To read this Indian Rupee update mail us for subscription details.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage India: CNX100 traded stocks and Indian Indices.

Michesan Anna-Maria, discovered her interest of markets immediately after completing her graduate studies in Economics. She followed it up with post graduate studies in corporate finance. A host of research work in behavioral finance, option strategies and quantifying market sentiment followed. Anna covers Indian equity and combines Elliott, Time Fractals and Time Analytics to deliver accuracy across time frames.


Short Ideas

The latest ALPHA illustrates the short ideas.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage: CNX 100 components and all Indian Sector Indices.

Mukul Pal, is a Chartered Market Technician, MBA Finance and a member of the reputed Market Technicians Association (MTA). He has more than a decade of Capital Market experience dealing with derivatives and global assets. He has worked for Bombay Stock  Exchange, multinational Banks and brokerage houses in leading research positions before starting on his own in 2005. He is the President of the MTA Central and Eastern European Chapter.


What is the problem with momentum?

It’s tough for a technician to ask such questions. But then there is no stupid question. So here it goes. What’s wrong with momentum? Though conventionally momentum is understood as an oscillator that defines overbought and oversold, momentum can also be defined as a detrending cycle calculated on an asset price. When the cycle is up, prices are strong and vice versa. When the cycle reaches an extreme high, its an overbought situation and vice versa. The problem is that performance could be different at different degrees of time i.e. the trend for different degrees of time can be different. On a daily time frame performance of an asset could be overbought and ready to reverse. On a weekly time frame performance could still be positive and have no signs of reversal. On a monthly time frame performance prices may have not have completed a 24 month bear market yet. While on a quarterly time frame the asset might be already in a major multi decade bull market.

How can this happen? This does happen. And this is what momentum (say Rate of change) is suggesting on Indian Nifty. On daily it’s suggesting 5,750 as high potential resistance reversal, on weekly ROC is still positive and does not confirm the daily view that 5,750 would really be a serious resistance, monthly ROC is still negative from the 24 month bear market and still below zero line (which is conventionally interpreted as the first sign of change of trend), while quarterly ROC momentum never fell below zero after 2004 low. According to the quarterly ROC Indian markets never entered a cycle degree bear. So what is the problem? The problem is that momentum does not harness different degrees of time in one common indicator. There are special indicators like Pring’s KST that attempt to harness multiple degrees of time. Maybe this is why it’s called Know Sure Thing (KST). We need more indicators like KST because a trader does not want to look for a reversal based on daily at 5,750 and get whipsawed by a move up to 5,800 or 6,000.

We think a multi week reversal is near. March is known for reversals and we are getting our ‘short-idea’ list ready for you. Remember market’s don’t move in straight lines. No correction means violent correction. So use the current upside to reassess your winners and losers. We have carried the NIFTY update from our intra day TICKS service for you. Enjoy.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Coverage: CNX 100 components and all Indian Sector Indices.

Mukul Pal, is a Chartered Market Technician, MBA Finance and a member of the reputed Market Technicians Association (MTA). He has more than a decade of Capital Market experience dealing with derivatives and global assets. He has worked for Bombay Stock  Exchange, multinational Banks and brokerage houses in leading research positions before starting on his own in 2005. He is the President of the MTA Central and Eastern European Chapter.

 


Multi Tier Filtering


Since there can be a lot of worst performers in 1000 component asset group, we follow a multi-tier filtering process.

1) Rank the 1000 group
2) Filter the list for UK 100 or BSE 500
3) Filter for worst < 20% ranking in the interest group (UK, US, India, Commodities etc.)
4) Filter for stocks that have positive cycles (grey mode)
5) Filter that list for outperformance vs. composite Index FTSE for UK 100 and Sensex for BSE 500 components.
7) Filter again among this list by making sector pairs.
8 ) Find the reduced list of BUY stocks.

This report carries Mean Reversion Indices for the UK, US  and India region along with current running signals for the respective Indices. The indices are passive and based on weekly data.

To read more about our JISEKI Rankings, Indices, Signals and queries mail us today.

Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.

Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.

Avinash Barnwal is Master of Science in Statistics and Informatics from IIT Kharagpur. He has worked on human response time at Department of Psychology, University of Amsterdam.  Avinash is a Quantitative Analyst at Orpheus developing money management solutions and building statistical models to address temporal challenges.