Welcome New FM

I am too tired to make a long post hence resorting to something of manageable size. Moreover making trading post or last part of MA posts will need lot of writing and probably many charts and I have no energy left for that. Still I think tomorrow or day after I would be able to make part 4 of MA and then on Sunday I will make a trading post. This time, even if I do not get a clear trade, I will still post what I think will happen with the assumptions and also what risk it poses. That should qualify as trading post. Rest you guys will decide and let me know through your comments.

Today was expiry day but still the markets did not move a total of even 1% in entire day. So much for expecting volatility on expiry day. This move does not mean that everything is calm and stable. Market simply appears to be cautious ahead of the two day EU Summit that begins today in Brussels. Though one cannot be too optimistic about outcome of this summit due to opposing views of EU leaders and too many undercurrents but more and more the summit appears to be Angela Merkel (Germany) Vs the Rest of the Europe. It is correctly so because whatever the cost of saving Europe most of it has to be paid by Germans. You can read about it here.

Then as I had expected, Manmohan Singh (MMS as I call him) started acting as soon as he took charge of Finance Ministry. Though not exactly any Earth shattering announcements, he made all the right noises. However what really is encouraging is his readiness to roll back some of the archaic announcements of last General Budget. Particularly sweet sounding to the ears of FIIs will be the rollback of GAAR (General Anti Avoidance Rule) which targeted Vodafone but spooked entire FII community. I personally would have preferred if somehow Vodafone was made to pay but the cost of going after them is too much. Sometimes it is better to loose a battle if it helps us win ultimately.

Another important step could be the clarification regarding taxation on P-Notes (Participatory Notes). Rather than changing all or rolling back all these policies, if MMS can only bring clarity about them in short time, he would have started well as FM me thinks. This is one area where he is comfortable as been there done that in 1991 and I hope he weaves his magic once again. We have problems but none of them insurmountable and fortunately we have a FM at the helm who knows all too well how to do that. If he addresses policy clarity issues, he will have more air to breath while tackling structural issues.

As for the market, we are delicately balanced at 200 EMA and are free to go either way and outcome of EU summit will play a role in NIFTY direction at least in next week. Will post about that on Sunday for sure. Waiting for your comments till then. Happy trading.