Seeing a lot of people making triangles with just 2-3 touchpoints offlate

An ideal triangle shall have at the minimum 5 touchpoints in order to give a good trending move post that

Here are few examples 👇

#HdfcLtd

Entering demand zone

Look for reversal signs to enter long side

#AxisBank

Seems big move coming up 👀
Looks bullish here at 751
Can do 785/795 in June series and 841 by July series
Invalid below 725

#HdfcBank

Weekly chart 4 weeks back
Taking classic support at trendline

Last week candle super bullish after sideways action of 3-4 weeks

Daily chart breakout as well

Heading towards ATH as long as above green trendline

#INFOSYS

Time to be alert on this one on long side

Cmp 1875, expecting wave C move down towards 1600 in coming days

View negates above 1954 previous top

#INFOSYS

100 points dip so far

Moving on expected lines positionally

Chasing extended #stocks is often not rewarded! What's extended?

1) >70% above EMA 200
2) Up 3 days in a row
3) >3 pullbacks on the EMA 21
4) >5% above trading base without pullback
5) >10% in one day It's better to wait for a consolidation before you enter.

I personally don't buy any breakout! It must fulfill some criteria:

– Volatility contraction closely to the breakout line
– Volume dry up
– Sound chart pattern
– Story stock or great fundamentals

Pay attention to the details!
Don't blindly buy every outbreak.

Understanding HIGH & LOW VIX

VIX at 16: If you check today's IV behaviour, they were not spiking much even with decent delta move in BNF. The movement was subtle, giving some time to adjust. So someone having good adjustment mechanism can stay in the game longer.

1/

VIX at 20: The same delta move will be more fierce, coupled with rise in premiums. When premiums rise with movement, then the adjustment cost increases exponentially. The premiums can fall back at EOD, but the damage is done if caught in the spike.

2/

After talking to few traders, their backtest result was in favor of high VIX of 2020, rather than 2017-19. The key flaw in the backtest were the adjustments which are not easy to calculate. Combination of high theta & fixed SL during high VIX, the IV crush is cashed at EOD.

3/

Neutral option sellers who don't adjust & have fixed SL on a static straddle will not be able to benefit highly in low VIX. The straddle which moves away from ATM will increase no matter what. But if we keep on rolling our strikes, then we get good realisation of theta.

4/

I have made majority of my profits in option selling when VIX was at 13-15, mostly just relying on my adjustments. Since 2020 with high VIX, adjustments stopped working because of increase in the frequency of delta + IV spike combos & so had to shift to directional trading.

5/

It's the weekend!

Grab a cup of coffee, in this thread I will explain

1. What drives valuation of a company?
2. Why some companies are valued at high multiples while others aren't?
3. What you should be looking for while buying a business?

Lets dive right in.

Not so long ago, Maruti released an ad campaign - 'Kitna Deti Hai'? (What's the mileage?)

Here is one of the ad's from the

The ad was on point - Indians before buying a car or any vehicle obsess over the mileage the most among all the other specifications.

We as a society are very value conscious.

Nobody has to teach us to drive a good bargain.

The logic for obsessing over mileage also checks out.

If a vehicle gives good mileage then over time as owners of the vehicle you will end up spending less on it in fuel and other added costs.

This ability to gauge long term value before buying something is magically lost when we enter stock market.

Here too you should be asking your stocks - 'Kitna deta hai'?

This time instead of obsessing over mileage, you should be obsessing over cash flows.