ECB Coeure

Spain, Pain & Sprain………
PIIGS : Portugal, Ireland, Italy & Greece.
PIIGS is really going through pain. And now core area of pain is Spain.Europe contagion now spreads to Spain and Portugal. Suicides case in Portugal at all time high.
This proves that people in Europe are not happy. So how can economy do well when people are not feeling good? With Spain’s three-month-old government struggling to reduce the budget deficit and crack down on overspending by regional administrations, borrowing costs have surged, nearing the levels that precipitated bailouts for Greece, Portugal and Ireland. Spain may “aggressively” tap support from the ECB instead of seeking a bailout. European Central Bank Executive Board member Benoit Coeure triggered speculation that the bank will revive its bond-purchase program to lower Spain’s borrowing costs as the region’s debt crisis threatens to boil over again.
We expect a very significant intensification of the euro- area debt crisis to materialize this quarter as the market refocuses on the fundamentals and the fiscal challenges of each country. Would Spain won’t need a bailout and will regain investors’ trust with the deepest austerity measures in three decades, including spending cuts and tax increases?

Our view for market is still bearish. Nifty is having a strong support at 5135.Nifty expected to trade in range of 5135 to 5350.

Thanking You

Atul Sikrai
Sr Vice President
wiTdom investment advisory.

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Operation Evil Cat.

Now Bears are going to love this blog. We at wiTdom are predicting that worst is yet to come .After evaluating macro and micro economic situation we feel that economy is still not out of the woods. Problems in Europe have not been resolved but panic is just been delayed by liquidity injection by ECB. Hard landing in China is here to stay being a growth engine of the world any slow down indication is going to jolt the growth of world economy. We expect that by early 2014 all commodity prices and asset prices are going to touch new lows. Any where in end of 2013 we may see new low on stock markets around the world which will be below 2008 lows. Now each one of you know that 13 is evil and cat is going to create lots of pain and anger on living being on earth. American economy is improving and stands at much better poison so our love for dollar still stays intact.
Our view for Nifty and sensex is negative .The New General Anti-Avoidance Rules (GAAR) provisions which will be applicable from April 1 2012, will see large scale selling pressure from Foreign Institutional Investors, with markets still unclear on the impact of the provisions. It may be recalled that Union Budget 2012-13 had provided for GAAR, following the Vodafone Supreme Court verdict in favor of Vodafone. FIIs will sell heavily on fears that the Union Government may raise tax demands as a result of these provisions. It is now believed that P-Notes through which billions of dollars flow into stocks will now be taxed. Any closing below 5160 can take Nifty to low of 4500 if 5080 is breached. We expect lots of selling by Hedge fund community in coming days.

Thanking you
Atul sikrai
Sr Vice President and Head of Equities
wiTdom investment advisory.

wiT + wisdom = wiTdom

Wit + wisdom = wiTdom
Can you concisely summarize your investment philosophy in a few sentences? My experience is that most people can't. The quotes that follow are diamonds that offer a real powerful education in the world of Risk Management. They have had a profound impact in my life. I pass them along hoping they achieve a similar effect on your investments. Enjoy!

1) "Rule No. 1: Never lose money. Rule No 2: Never forget Rule No. 1." -
2) "Large profits can be made in common stocks. Large losses can be made in common stocks."
3) "A fool and his money are soon parted."
4) "A fool and his money were lucky to get together in the first place."
5) "You should invest in a business that even a fool can run, because someday a fool will."
6) "The key in life is to figure out who to be the bat boy for."
7) "Let Wall Street have a nightmare and the whole country has to help them get back to bed again."
8) "There are two fools in every market. One asks too little, the other asks too much."
9) "The elements of good trading: (1) cutting losses, (2) cutting losses, and (3) cutting losses. If you can follow these three rules, you may have a chance."
10) "That market doesn't care whether you are IN or OUT! With that being the case, my question is who are you competing against? Most people will answer 'everyone else' my response is 'look in the mirror.'
Thanking You
Atul Sikrai
Head Of Equities
wiTdom investment advisory.
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Credit Event

Credit Event:
Greece Default at last it has happened. Thanks God its orderly default and not disorderly default.
This is what financial expert around the world where waiting for and atlast it has come true that Greece is declared bankrupt.
The ISDA said the use of "collective action clauses (CACs) to amend the terms of Greek law governed bonds issued by The Hellenic Republic such that the right of all holders of the Affected Bonds to receive payments has been reduced.” The "credit event" ruling means a maximum of $US3.16 billion of net outstanding Greek credit default swap contracts could be paid out, though the actual amount is likely to be lower because bondholders are not losing all of their original investment .ISDA said the auction will be held to determining the actual payout amounts on March 19.Greece said it would use the newly passed legislation that included the CACs to force private creditors into a bond swap. This follows creditors' voluntary tendering of 85.8 percent of the 177 billion euros in bonds regulated by Greek law. The use of CACs should boost participation to an estimated 95.7 per cent.

Credit default swaps tied to Greek sovereign debt have been triggered.
Dollar is expected to strengthen from here .We expect Dollar Index to resume its up move once again.

Thanking You
Atul Sikrai
Sr Vice President
wiTdom investment advisory

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Golden cross

As long-term indicators carry more weight, the Golden Cross indicates a bull market on the horizon and is reinforced by high trading volumes. Additionally, the long-term moving average becomes the new support level in the rising market. Technicians might see this cross as a sign that the market has turned in favor of the stock.
A crossover involving a security's short-term moving average(such as 50-day moving average) breaking above its long-term moving average (such as 200-day moving average) or resistance level.
--S&P 500's 50-day moving average crosses above 200-day moving average
--'Golden cross' is thought to mark transition to bull market
--Previous golden crosses preceded material gains over next two months

The Standard & Poor's Composite Index of 500 stocks posted its biggest January point gain in its history. But what may be technically more important for the longer-term outlook is that the S&P 500's 50-day moving average, or 50 DMA, crossed above the 200 DMA for the first time since Aug. 11, 2011.

Many chart watchers believe this technical event--referred to as a "golden cross"--marks the spot when a bounce within a bear market transitions to a bull market. I being a technical analyst have noted that "all sustained bull markets by definition come with the 50 DMA above the 200 DMA."

Just closely watching if Nifty and Sensex forms Golden Cross ?

Thanking you

Atul Sikrai
Sr Vice President & Head Equities
wiTdom investment advisory.

The Lighter Side of Euro:

Mind you, humor is one thing that always crops up during a crisis, as demonstrated recently in this Blog.

Greece – a country that by its very name would make the Union slip-slide away.
Greece – a country where Euro means toilet, and that’s where it’s going.
What's the capital of Greece? About €3.
Q: Why is the Irish economy in such a crisis?

A: Because they always think their capital should be Dublin.

Ireland’s been downgraded from AAA+ to AA. Before, they were a battery for the remote control, but now they're only good for a Walkman.
It gets worse.
A Greek, an Irishman, and a Portuguese go into a bar. The German pays.
Hmmm ... how many jokes can we take?
And perhaps some of this is no joke.
After all, the Germans saying that they’re going to holiday in the Greek Islands for the next ten years because they’ve prepaid ... may go down well in Germany, but any German trying that in a Greek hotel, may find themselves out on their arsch.

So what is the reality?
In Heaven: the cooks are French, the policemen are English, the mechanics are German, the lovers are Italian and the bankers are Swiss.
In Hell: the cooks are English, the policemen are German, the mechanics are French, the lovers are Swiss and the bankers are Italian.

The European Parliament has decided to change the design of the euro when noticing that the first one was a bit boring and sad. The new design is a stronger and more aggressive one which will make people eager to consume. The European Commission has just announced an agreement whereby English will be the official language of the EU rather than German which was the other possibility. As part of the negotiations, Her Majesty's Government conceded that English spelling had some room for improvement and has accepted a five year phase-in plan that would be known as "Euro-English".

Meanwhile, some believe that Britain will regret not being part of the euro. This is down to the new controlling stranglehold in Europe of the inner sanctum – those in the euro – and the rest – those not. This may create a rift in European Union, but is necessary if the Germans are going to keep paying for holding the Euro zone together. This is why some folks, even those within the Conservative Party, believe the UK must one day join the euro too. Nevertheless,talks of joining the euro are more divisive in Britain than ever, and is still unlikely in my lifetime.
One of the reasons they would never want to join the euro of course, is because they like the Queen and the Pound.

God Bless Euro

Keep Laughing

Always yours

Atul Sikrai
Sr Vice President & Head Equity

Disaster EDU Jour!

Disaster EDU Jour!
EDU: European Disunion.
As told in our last blog that we expected a Santa Claus rally.Markets around the world have risen up as per our expectations.We recommend all our readers to book profit on their long trades and go short on markets again.
Why to book profit on Long and go short again?
Euro is pain point it has tumbled down. Euro to Dollar is trading bellow our comfort zone of 1.30 it’s around 1.27 we expect it to crack down to 1.20.
What we see that environment is uncertain in Euro zone.We expect some kind of systemic failure in coming days.There is lot of uncertainty in financial markets. Look at Italian 10 year bond yield it’s still above 7 %.Lots of pain point still exists in Spain and Greece in coming days.
Spain's jobless rate is currently double the average for the euro zone, rising to nearly 32 per cent in places like Cadiz, a windswept port that has never recovered since its shipbuilding yards went the same way as those on the Clyde. The economy shrank nationwide by nearly four per cent last year, and in the bars of Cadiz's winding, cobbled streets, the sense is that things can only get worse - which, last week, they effectively did.
In France, the messages are also now mixed. Many believe that Mr Sarkozy's alleged pull-out threat was little more than sabre-rattling, pointing out that the French political establishment has long been wedded to the euro. Yet Nicolas Dupont-Aignan, a fomer member of Mr Sarkozy's UMP party who now runs an organisation called "Republic, Stand Up", claims to have got tens of thousands of signatures for his newly-formed petition, titled "Let's Leave the euro Before It's Too Late".
"Great Britain was very fortunate to stay out of the euro," he said. "Why should we have to pay the debts of other countries? The politicians in France created a religion, a dogma around the euro. But France is not Germany, and the French people do not want the German austerity cure, either politically or socially."
Be Smart and book your profit on stocks which has risen more then 25%.
Nifty too has bounced back to 4870 from our recommended level of 4650.

Thanking you
Atul Sikrai
Sr Vice President & Head Equities
wiTdom investment advisory.