Sensex Technical View :
As shown in previous charts the recent low has been near to important zones and we are still sustaining above 16500 even after a big crack. Technically resistances are placed at 18800-19000 and a good consolidation is needed between 16-18 k in the next 3 weeks to confirm that the bottom could stay for much longer time. On a long term basis the bull trend continues to be strong. Supports at 17200 on lower side.
Many of the readers who have been reading the blog regularly must have seen the amount of caution and disciplined advised in the second week of January with a detailed article on exitting pennies and on mid caps and small caps. People who took the caution and stoplosses effectively must have been spared of much pain ( watever dip investors have seen is notional ) .
As was mentioned yesterday we continue to remain highly bullish on banking stocks as always for the long term and are a buy on market dips . The current short term run may be attributed to RBI meet etc but the long term reasoning is beyond crr rate etc. Investors with 1 yr + view and looking towards A group stocks should have a very high weightage on banking sector.
Many of the discussed stocks like IDBI , HIND Oil exp etc hav moved up 10-20% and can continue to hold the part qty with 3 mths view.
Some Thoughts :
The current deep crack in markets has left many traders on the losing side because of the lack of discipline and optimism instead of a cautious approach. Where ever u go on the street people are talking of markets and reasons vary from reliance power , future capital , dow jones , FIIs and some even talk Al qaeeda and wat not. The simple thing an investor or trader has to be focussed on his portfolio , business and the discipline by which it has to be done rather then to focus on the world.
Simply put , the worldwide economics is not what all can understand , talking and bluffing abt it can only make u feel in a an illusion of being knowledgeable . One has to understand that you are in the markets for making wealth or some other reasons . And to make wealth in markets one needs to be focussed on their own strategies and discipline.
Fundamentally nothing has gone wrong with the markets and there were some excesses and over optimism in certain stocks which has now been tempered down. Also the stocks had given returns way beyond the fundamental targets .
As per Technicals the foremost thing in taking a trade is to keep a strict stoploss as it is all about prices . People would book earlier on targets but will never cut on stoploss. Some people stoplosses give u some losses all the time but not keeping them can take your total capital away.
So if you follow both of the above analysis and if u have lost big money then what one has done wrong is the discipline . So do take care as every lesson learnt in markets is worth millions of rupees in the future.
PEOPLE SERIOUSLY INTERESTED IN LEARNING TECHNICAL ANALYSIS TO BECOME AN INDEPENDENT AND A DISCIPLINED INVESTOR AND TRADER CAN GET IN TOUCH .
MUMBAI SESSION FEB 9-10.