Wait till storm gets over

Dear Investors

Wait till storm gets settled

           

                   

Market closed today with huge losses in Nifty and Sensex .During the day Nifty tested a low of 5878 and recovered just above 5900. For last three days markets are testing lower lows .This is a bearish signal. I have been indicating all those days that if

a)     Nifty brakes below 5920, then there are chances that Nifty will test 5850/5766 levels in coming days

b)     If Nifty crosses the resistance levels of 6080/6090 then the next levels   to be watched are 6115/6220

     

 As of Now:

The sense is clearly downwards and this is what I have been saying for a while, that we would be in a range of 5700 to, possibly, around 6050. 

Right now, the cues which are coming, are negative, even closer home, the amount of scams, the arrests and news of CBI on Raja, so basically all these adverse news is taking its toll on the markets and we should see the markets going more towards 5766 levels. 

The selling has not been huge. It’s the lack of buying which is probably disturbing people. The fact is that market is not getting any liquidity support. The liquidity situation for stock market  is a little tricky one, because DIIs( Domestic Institutional Investors) have started selling again and HNIs(High Net worth Individuals) and retail have been stripped off, due to fall in Mid and Small caps

You cannot expect too much liquidity to come from them in the near-term. Then who is going to provide the liquidity? That is the biggest question.

Without liquidity and with daily selling pressure, on ‘Bad News’, Nifty is likely to break 5800 and may test 5766.

Then…………………….

 The decisive support is at 5690, a previous low and if broken then we are likely to test the series of support levels,   

Ultimately to take us to the level of 5510 which is 200 DMA, an important one to decide the medium term trend?

Keep eye on

20DMA@5972

50DMA@6061

200DMA@5503

One has to accept that even though fundamentals have not changed,  at times you have to go by Technical  trends

So watch carefully, do not jump on either side’ Long or Short’

For those who still wish to try, can look for safe places like

ONGC

RIL

GAIL

HCL TECH

BAHARATI

IDUSIND BANK

JAGARAN PRAKASHAN

For risk takers:

Khaitan Chemicals

V Guard

Ador fontech

Kabra extrusion

Godawari power and Ispat

Sanjivani Parenterals

Tutis Tech

Cybele

Are good short to long term bets

Try your luck

Happy Investing

Thanks

Dr. Vasant Bele

Disclaimer: Views expressed are mine. Take your own investment decisions