The surprise RBI announcement led to the markets soaring away and the Nifty gained about 2.8 pc for the markets to close at 8514, tantalizingly close to the previous high. Let us try and see what direction the markets take from here.
1. The assumption was that the markets are correcting down from 8627 in 3 waves.
Wave 1 = 8627 - 7961
Wave 2 = 7961 - 8531 (ongoing)
and Wave 3 to take us down to at least 7961 levels.
This hypothesis will be nullified if the markets cross the previous highs from here.
2. If the markets break the previous highs, then we can see a rally till the budget at least to take us to 9000 levels.
3. The Gilt funds gave further returns when the yield for 10 year G-Sec came to 7.67 pc, I would suggest to recommend booking part profits at this level in Gilt funds.
A thumb rule for Gilt funds is keep adding positions when the yield crosses 9 pc and keep part booking yield goes below 7.5 pc.
4. The crude oil prices further weakened and look to be remain weak for the first half of 2015.
5. The FIIs have been marginal net sellers for the month of Jan. With the Government divestment coming up in PSU companies, the upside may be capped because of that.
The uncertainty over whether we are still in a correction or we are headed to new highs will be cleared in the coming week.
1. The assumption was that the markets are correcting down from 8627 in 3 waves.
Wave 1 = 8627 - 7961
Wave 2 = 7961 - 8531 (ongoing)
and Wave 3 to take us down to at least 7961 levels.
This hypothesis will be nullified if the markets cross the previous highs from here.
2. If the markets break the previous highs, then we can see a rally till the budget at least to take us to 9000 levels.
3. The Gilt funds gave further returns when the yield for 10 year G-Sec came to 7.67 pc, I would suggest to recommend booking part profits at this level in Gilt funds.
A thumb rule for Gilt funds is keep adding positions when the yield crosses 9 pc and keep part booking yield goes below 7.5 pc.
4. The crude oil prices further weakened and look to be remain weak for the first half of 2015.
5. The FIIs have been marginal net sellers for the month of Jan. With the Government divestment coming up in PSU companies, the upside may be capped because of that.
The uncertainty over whether we are still in a correction or we are headed to new highs will be cleared in the coming week.
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