WHY TRIGGERING A MINI STOP LOSS IS BETTER THAN SITTING IN UNLIMITED LOSS MAKING TRADE

Morning,

Referring to my trailing post of sell trades for indices and having 50 and 100 points stop loss on NIFTY and BANKNIFTY given on 31st January 2017. They both got triggered in last few sessions. It is important to understand why triggering of a stop loss is important instead of sitting in an unlimited loss making trade.

I have been of a NO trade view at least not for buying since 4th January 2017 and hence have only been stock specific.Post made on 22nd November 2016 on POSITIONAL BUY CALL GIVEN ON MARUTI at level of 4830 with a mini SL of 4767 (63 points) and targets till 6100. This was achieved in last week and has already overpassed the final target of 6100. Though i had given exit from all buying on 4th January when it was trading at 5500s, my endeavour was to make people come out before this ends up at the top and now since the targets are achieved in MARUTI, it is time to sell it again tomorrow or above 6300 with a mini SL of 6350 again and a POSITIONAL target of  4790-3200 range. The wave structure of MARUTI is about to complete and is in its almost last leg.

I am also stating the reason here why i felt that from 6825 till 8968 was an impulsive and later i told to exit everyone from buying. The time taken from the fall of 8968 to 7893 is too long when compared to the time taken to rise from 6825 to 8968.

If we consider the total time it was 6 months and 10 days to this overall fall which is almost 50% of the time taken to retrace the previous fall from 9119-6825, which was 3rd March 2015 (9119) to 29th February 2016 (6825), 3 days less of a complete year.The point at which i got this confirmation that this intermediate rise from 6825 to 8968 was not 1 2 3 waves of an impulsive wave but A B C of a corrective wave, is when the time taken to further make this complex correction is where the pattern gave the first signal that this fall from 8968 to 7893 (3 months 19 days) is again almost 50% of the time taken to rise from 6825 to 9119, which incase of a fourth wave correction has taken more time as compared to the overall rise from 6825 to 9119. Hence the latest rise from 7893 till 8814 looked as a part of an X wave because it has risen very fast and this is when i asked on 4th of January 2017 to exit from all buying irrespective of NIFTY was at 8219 and BANKNIFTY was at 17891 from there both have rallied 600 and 2500 points. Hence this uptick from 26th December 2016 till date looks more like a part of a complex correction rather than impulse. Again since we cannot achieve perfection in markets hence stoploss in the picture. Any one selling here on both indices i.e., NIFTY and BANKNIFTY is advised to maintain an ultimate strict SL of 8950 and 20500 on closing basis on NIFTY and BANKNIFTY respectively. All levels mentioned are SPOT levels.

Also, if anyone is tracking DOW JONES, it has also reached a critical juncture by making 20155 and is at the verge of a lifetime reversal for a severe fall. Confirmation of this will only come when we see it taking out 20000,19900 and 19700 for targets of 18600-18000-17200-16000-15300-14200-13000-11900-10400-9700-8900-7400-6500 and so on in the coming years. (Yes these levels looks like a crazy/freak call by someone but this is what elliott wave has the ability to do for you)

In addition to the above recommendation on selling MARUTI i have a lot of sell recommendation like the IT pack and PHARMA pack i have been bearish since last quarter along with individual stocks like VOLTAS, RELINFRA, the whole STEEL sector is about to/or has topped out namely, TATASTEEL, VEDANTA, HINDALCO, JSWSTEEL, JINDALSTEL etc.

Some big boys like ULTRACEMCO, MCDOWELL-N, ITC

In OIL & GAS sector ONGC, CAIRN and finally TELECOM Sector like IDEA and my all time favorite RCOM (have been giving sell recommendation since December 2015 from the levels of 92).

Hope i have answered everyone who asked me in the last 1 week.

Happy Trading !