I would summarize the calls I made in last year and add my views on them for current year. but before i start with the recap let me share some of my insight regarding the problems i faced using my calls for trading.
Musings:-
Since I have become an active trader, I have understood that giving calls is very different form trading them. While giving calls you don’t have any impatience as you are not losing money even if the calls are initially not working. You can sit them out. For example I first gave a buy call on Shangahi Composite in June 2013 and the index did not move for next 15 months. But when it started moving in September 2014 it went up 40%+ in short span of 4 months.
Its only possible to get these kind of moves if you have lot of patience, faith and you are ready to lose small amount of capital and still stick to your call.
Since fund managers are evaluated on their yearly performance it may not be entire feasible to trade such long term calls as the investor and the evaluator or the consultant may not have patience to wait.
Let us first look at the disappointments for the year.
What I expected:-
I have been bearish on US markets
since quite some time now. I had a strong conviction that after a strong rally
in 2013, 2014 will be a year of correction. I gave a sell call on S&P500 in
January 2014 at 1850 levels. The primary reason was that S&P500 is trading
at the upper end of the channel and unless it decides to break out of the
channel a correction is very much likely.
What happened:-
The index kept on chugging along
with the upper end of the channel line instead of correcting. The index gave a
return of 13.8% for the year 2015.
What I expect:-
I still think that a
correction in S&P500 is imminent. Stock returns are not path independent,
which means that the returns of current year are strongly going to be
influenced by past performance trajectory. After 5 year bull market a
correction is highly likely and technical support their view. I am still
bearish on market and will remain so unless S&P500 breaks above the channel
line.
What I expected:-
I have been expecting rally in precious metals since September 2013 and reiterated my call on January 2014. I have been constantly bullish on the metal since then and the market has completely deluded me.
What happened:-
Both metals stayed in consolidation/ correction mode and both metals hit my stop loss.
What I expect:-
I believe that both metals will resume the rally once sometimes in this year. I will be bullish on Gold once it gives a monthly closing above 1250 and on silver if it gives monthly closing above 20 USD.
My Hits for the year
What I expected:-
I have been bullish on US dollar since June 2011. I wrote, “ DXY:- Looks like it will break out of 26 years of down trend and
will move up to 100 levels in next 2 -3 years.”
What happened:- Although, it took time for Dollar to take off, it took off with a
bang. This year DXY went up from 80 to 92 and rallied more than 15%.
What I expect:- DXY faces a major
resistance at 93 – 95 levels and once that is surpassed on monthly closing
basis DXY will move towards 100 and beyond.
What I expected:-
I have been consistently bearish
on Euro for last two years and gave a sell call on Euro in the same post. I
gave a sell call in Euro when it was trading at 1.38 with a target of 1.30,
1.20 and below that.
What happened:-
Euro crashed form 1.38 levels to
1.18 levels.
What I expect:-
I expect the downtrend in Euro to
continue after pull back and it should eventually move towards partity with
USD.
What I expected:-
Similarly I have been bearish on
all these currencies against USD since last two years and they all fell significantly
against USD in 2014
What happened:-
I have been bearish on most of
these currencies since last 2 – 3 years, most of them started correcting in
2014 and saw large down moves.
SEK fell from 6.8759 to 8.0580
Yen fell from 102.89 to 120
CAD fell from 1.06347 to 1.18
GBP fell from 1.6650 to 1.51
AUD fell from 0.85376 to 0.81
CHF fell from 0.9492 to 1.0143
What I expect:-
I expect the broad based selling
against USD to continue with some significant pull backs and all of these
currencies will continue to slide.
What I expected:-
My calls for INR has been mixed
in current year. I gave a buy call on INR on 9th May 2014 with a target
of 57. INR fell to 58.33 but then moved up to take my stop loss of 61.30.
I gave a sell call on INR at 9th September 2014. INR was
trading at 60.6050 and my target was 63.
What happened:-
INR depreciated mildly against USD
and was one of the strongest of all currencies. It closed the year at 63.50
levels and hit my target.
What I expect:-
I expect INR to deprecated once
it falls below 64 to USD and move towards 70.
What I expected:-
I have been bearish on Nifty
since November 2014, After staying bearish for last 4 years I turned bullish on
Indian markets and expected them to break out and move from 6500 to 8200 levels
in my post written on March 12, 2014
What happened:-
Nifty closed the year 8282 levels
and made a high of 8626 levels. That was almost 32% higher from my call level.
What I expect:-
Nifty is trading at significant resistance
and may correct from current levels before it breaks upward. I believe that we
are in a long term bull market in India and will see markets going significantly
higher in next few years.
I gave a buy call on both these
index on 18th September 2014. Shanghai was trading at round 2315
levels while Nikkei was trading at around 16067 levels.
What happened:-
Shangahi composite moved up more
than 40% in last 6 months and made a high of 3325 while Nikkei moved up from
16000 levels to make a high of 18030 levels. As readers may remember I gave my original
buy call on Nikkei on 16th November 2012 when it
was trading at 8000 levels.
What I expect:-
I expect the up move to continue
in Nikkei while Shanghai should see some stiff resistance at current levels.
Once Shanghai breaks above 3500 level it can move significantly higher.
Crude Oil:-
What I expected:-
My call on crude could have been
one of the best call in my blog till date. I gave a sell call on crude on 16th
November 2013 when it was trading at 115 and reiterated my sell call on 10th January 2014. I changed my call due to a sucker rally and
changed it to buy if it breaks above 120 in June 2014.
What happened:-
Crude oil never broke that level
and had one of the most spectacular fall of last five years falling more than
55% from 115 to sub 50 USD.
What I expect:-
Long term average prices of crude
oil should stay between 50 to 80 USD.
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