It is a new month and time to again check statistically how the markets have fared in the month of March. The expected range for Feb was breached on the lower side thanks to the budget day effects. The downward bias was maintained in the month.
1. Traditionally, march has been a down month with 7 out of 12 past years it showing a negative bias. Only 2006 and 2009 have been huge positive years.
2. The good news is that whenever February has been negative, march tends to be positive. This year we had a negative February with a 5.7 pc decline.
3. The average gain for the month of March is 0.17 which is hugely misleading as there have been huge swings across the years.
4. The markets generally tend to go below the February closing price in March. On an average it could be around 4 pc. This would mean 5470 - 5500 on the lower side.
5. On the higher side, the markets can go up even 7 pc. This means an upper range of 6091 which is improbable but not impossible. A more likely figure will be a gain about 5 pc which is what last 5-6 years average indicates. This gives us a figure of 5977.
The Range which is in play is roughly 5500 - 5950. We are right now at 5719 which is very close to the mid point of the range at 5725.
It could very well happen, that in the first half of the month we test the upper half and then the lower half. Let us wait and watch how the markets behave. based on this range, I will post a derivative strategy for Thursday.
The Budget was a non-event and a pragmatic budget. Let us accumulate quality stocks at lower levels.
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| Gains in March over the years |
2. The good news is that whenever February has been negative, march tends to be positive. This year we had a negative February with a 5.7 pc decline.
3. The average gain for the month of March is 0.17 which is hugely misleading as there have been huge swings across the years.
4. The markets generally tend to go below the February closing price in March. On an average it could be around 4 pc. This would mean 5470 - 5500 on the lower side.
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| % below Feb Closing |
5. On the higher side, the markets can go up even 7 pc. This means an upper range of 6091 which is improbable but not impossible. A more likely figure will be a gain about 5 pc which is what last 5-6 years average indicates. This gives us a figure of 5977.
The Range which is in play is roughly 5500 - 5950. We are right now at 5719 which is very close to the mid point of the range at 5725.
It could very well happen, that in the first half of the month we test the upper half and then the lower half. Let us wait and watch how the markets behave. based on this range, I will post a derivative strategy for Thursday.
The Budget was a non-event and a pragmatic budget. Let us accumulate quality stocks at lower levels.
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