The markets lost another 2 pc to close the week at 5565. The market appears to be oversold in the short term. This can result in some kind of bounce. We would have to see the nature of the bounce.
1. The FIIs have stopped selling in the moth of August. They have been net buyers so far in the month. The markets have continued to fall despite this.
2. 5400-5500 have a confluence of supports from which a bounce is due. When the markets fell from 6229, they fell till 5566 and bounced to 6093. The current fall has breached 5566 and hit a low of 5487. From the medium term perspective, this is bearish.
3. From the current levels, we may have a bounce till 5800-5900 levels. Only a sustainance above 5971 can tell us if the entire fall is over.
4. On the fundamentals front, nothing has changed much. We have new RBI Governor who comes in with very high expectations from him.
5. Fixed Maturity Plans of 1 year are giving about 10 pc returns. They can be looked at.
6. I leave you with 2 charts of RSI. Many times in the past, markets have bounced when RSI has reached the current levels. The bounce can be of 400-500 points on the Nifty.
1. The FIIs have stopped selling in the moth of August. They have been net buyers so far in the month. The markets have continued to fall despite this.
2. 5400-5500 have a confluence of supports from which a bounce is due. When the markets fell from 6229, they fell till 5566 and bounced to 6093. The current fall has breached 5566 and hit a low of 5487. From the medium term perspective, this is bearish.
3. From the current levels, we may have a bounce till 5800-5900 levels. Only a sustainance above 5971 can tell us if the entire fall is over.
4. On the fundamentals front, nothing has changed much. We have new RBI Governor who comes in with very high expectations from him.
5. Fixed Maturity Plans of 1 year are giving about 10 pc returns. They can be looked at.
6. I leave you with 2 charts of RSI. Many times in the past, markets have bounced when RSI has reached the current levels. The bounce can be of 400-500 points on the Nifty.
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