The markets fell another 2.4 pc thanks to comments by the Fed Chairman. Let us try and see what the next week and next few months have in store for us.
1. The markets right now are poised around the critical support area of 5600. There is an iteresting study done by Sanjay Raghuvanshi, who has calculated that markets rarely have an expiry which is + or - 300 points then previous expiry. Last expiry was 6124 which also means that this expiry can be around 5800.
2. 5400-5600 has several key trend line supports as shown in the charts below. Falling below 5350 - 5400 will terminate the entire rally from 4532 in the month of December 2011.
The Trend line support from the March 2009 lows comes to around 5350 - 5400
The market is presently at the trend line support from last June rally
The Trend line from the Dec'11 bottom is also pretty close by.
RSI is showing a positive divergence.
3. Saurabh had asked me about Debt Funds investing in Government Securities. The 10 year bond yield has rise to 7.44 pc from 7.14 pc low on the back of rupee weakness. I would say it is a chance to add more than exiting as the Equity Markets will bottom out only with Interest Rates falling down.
4. The Goverment has come up with a few set of reforms om Friday. I expect them to anounce more reforms in the coming week which may help the markets rally.
5. Gold can be avoided as I have maintained that a steep fall will not be retraced so easily. I see a bottom for Gold around 1000 USD mark. The Rupee weakening has partly offset the fall in the Gold prices in Dollar terms.
The Market still remains a buy on dips market.
1. The markets right now are poised around the critical support area of 5600. There is an iteresting study done by Sanjay Raghuvanshi, who has calculated that markets rarely have an expiry which is + or - 300 points then previous expiry. Last expiry was 6124 which also means that this expiry can be around 5800.
2. 5400-5600 has several key trend line supports as shown in the charts below. Falling below 5350 - 5400 will terminate the entire rally from 4532 in the month of December 2011.
RSI is showing a positive divergence.
3. Saurabh had asked me about Debt Funds investing in Government Securities. The 10 year bond yield has rise to 7.44 pc from 7.14 pc low on the back of rupee weakness. I would say it is a chance to add more than exiting as the Equity Markets will bottom out only with Interest Rates falling down.
4. The Goverment has come up with a few set of reforms om Friday. I expect them to anounce more reforms in the coming week which may help the markets rally.
5. Gold can be avoided as I have maintained that a steep fall will not be retraced so easily. I see a bottom for Gold around 1000 USD mark. The Rupee weakening has partly offset the fall in the Gold prices in Dollar terms.
The Market still remains a buy on dips market.
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