Technical Analysis of Indian Equities by Nooresh

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Will it panic when every body expects it !!

Panic2008

 

 

This has been one comparison which has been scaring me as an analyst as well as everyone on the street seems to be pretty confident of such a breakdown being played out before market bottoms out.

 

The previous channel was around 3000 and breakdown at 11000. This move led to a fall to 8000 levels which was more over accentuated with the news flow at that time.

 

Now currently we have a 2000 points channel for which a breakout point comes to 14800 that gives a drop to 12800-13000 levels in case of some adverse announcement or out of the blue scenario.

 

The previous bear cycle of 2008 had seen a lot of froth being created in 2007 with lot of margin pressures and that was precisely the reason for a deeper correction. In comparison to 2008 we have already spent 13 months in the current cycle almost equivalent to the previous cycle so i would term this a consolidation.

 

In the last 6-7 years of my experience i have never seen such a strong bearish consensus. A last bullish consensus was in 2007 🙂

 

So when every body expects 13000 and 3800/4000 will it comes i would doubt that. With such a VIX of 30 already people are preparing for such a fall.

 

Market tends to surprise the consensus.

 

 

 

Bottomline: 

Index may or may not go 13k and 3800-4000 levels but many stocks are on their way. So as an investor prepare for notional losses of 15-20% on the portfolio provided you have stuck to quality stocks and be ready to buy slowly in panics.

One of my favorites Aditya Birla Nuvo is down 760 😛 i expect 800-820 as a bottom is giving a good opportunity to buy. its a pure funda call ( technically its pretty weak can do 720 also )

Article by Nooresh Merani

Nooresh has written 2571 articles.

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{ 5 comments… add one }
  • JAGDISH K MODI December 20, 2011, 12:54

    HELLO SIR MARKET KAHA TAK DOWN HOGA PLS ADVISE

    Reply
  • JAGDISH K MODI December 20, 2011, 12:55

    SIR PLS AAP MUJE BATAYE PLS MERE KO BAHOT HI LOSS HE AUR SILVER AND GOLD KESA LAG RAGA HE PLS AAP MUJE ADVISE DE PLS

    Reply
    • nooresh December 20, 2011, 13:42

      Gold silver sell on rise.

      Reply
  • jagdish k modi December 20, 2011, 17:36

    silver and gold ke message aap dete ho to pls tips charge kya he aur profit kitne % ho sakta he pls advise me

    Reply
  • Nitin Karwa December 20, 2011, 23:19

    Could not agree more with you…its now fashionable to be bearish and everyones joining the. Party or the funeral as I may put it.

    Technical levels may be left to play out will play out but I think its a good entry point for some quality stocks I would invite reader and your attention to include

    Solar Inds, Rallis India, Wipro, J & K Bank, SRF, VST tillers etc which are. Essentially debt free and have good promoters managing solid business.

    Reply

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