The first half of the year has gone by and there has been lot of chaos and confusion since my last post. Covid 19 has wrecked havoc. My level of 10000 was comfortably violated and much more. Let us see what can happen in the future.
1. The market is awash with liquidity and disconnected with ground reality. Covid 19 blazes on relentlessly. I expect the markets to move up maybe make new highs and then re test the previous lows or 6500.
2. The markets will remain buoyant in the near future as the US Fed also is pumping in huge liquidity. Next few months will be very good for traders.
3. One must trade also only in blue chips else one can lose one's capital.
4. Gold remains a safe haven and is a buy on dips as a hedge.
5. US Presidential elections are a key turning point and if Trump loses or if there is chaos after the results the markets will nosedive.
The key things for a sustained bull run are:
1. Cure for Covid
2. Stable US Government
3. Stable Indian economic policies
Right now only point 3 is somewhat under control. The run up is factoring in that a cure for Covid is given, things will normalize. If bad loans start popping up as they will after the next quarter results, then the markets will correct.
It is a traders market not an investors markets. Use the rally to throw out laggards.
6350 were multiple tops in the past they will be strong support. 12400 will now be the new resistance points.