Super Hero Batben

The market broke below 5614 to trigger my STT sell on the Nifty. The LTT long remains intact. So currently I am 1/3 short on the Nifty.

I am writing this note on Monday evening and I find Euro down again and all markets in Europe down by a large margin. S&P has opened down too and is now trading well over a percent down. In the process, it has triggered my STT Sell at 1333 and that is not a good sign.

Almost all commodities with the exception of Gold are down. This is pointing to a big risk off trade. So things look okay for my 1/3 short position on the Nifty.

While all this is good, I cannot underestimate the powers of Super Hero Batben. He has forever been the benefactor of the longs and the nemesis of the short sellers. Some more economic bad news or bad news from the European region is just the excuse he needs to unleash his fire power. Just the fear of his strong action can arrest this fall. Short sellers dare not even utter his name - ala-He Who Must Not be Named of the Harry Potter fame. He has been strangely quiet for the past few days but it would be sheer folly to mistake his inaction for weakness. This is in all probability a devious trick to entice the poor short sellers before landing yet another sucker punch. Very soon, I fear, we will hear from him as he unleashes the terrible weapon of QE3 to destroy the unpatriotic shorts and restore the wealth of the patriotic longs.

It is another matter, that it is these very same patriotic long holders of CDOs and other risky assets, that created the crisis that needed the birth of Super Hero Batben.

Current Position STT Short LTT Long (-2/3 + 1/3=1/3 short)                                                                                                  

Possible Trades

Trade I:  STT: Cut short > 5646 (0 + 1/3LTT=1/3 long)

TradeII:  STT: Go Long > 5692 (2/3 STT + 1/3 LTT=100%long)

TradeIII: LTT: Cut long < 5560 (-2/3STT + 0 = 2/3 short)

TradeIV: LTT: Cut short< 5447 (-2/3STT -1/3LTT = 100% short)

And finally, do you know the definition of a villain? - A villain is a hero who has overstayed his welcome!