Market Tsunami Survival Next Week: Nifty Chances 50:50 To Go Up Or Down
Posted: Sunday, March 13, 2011
by Dakhsh Jain
Winfromus.com
Japan Tsunami 2011 has brought pain to a lot of people. Its being reported that 2000 people have lost there lives in the massive deadly 8.9 quake which hit Japan last Friday, 11th March.
Asian stocks reacted to the news on Friday as soon as the news were reported. Japanese Government has said that they will do all they can to provide financial stability in market in the week starting from tomorrow.
Question is, how will Indian stock market react to all this and what could be the affect of the Japanese tsunami on India as the after math looks horrible?
Technically market is near a zone from where it can break down or start moving up. Chances of both are equally strong and 50:50.
For next week, Nifty as long as above 5370, will bounce off lows and on the higher side market will follow stiff resistance at 5520. So technically markets will stay in a range until n unless either of the mentioned level are taken out.
Expect a ranged bound markets for few weeks, its March ending Profit/Loss adjustment time
Financial year is going to end. We are in the last month of the 2010-11 financial year. Its a month when all the Charted Accountants, tax auditors, lawyers, tax thieves etc stay busy doing what they are supposed to. Old books are closed, new books are opened. Profit and loss are adjusted, losses are booked, profits are carried forward.
Apparently its a time when not much activity takes place in markets. And given the global plus internal scenario, we are not expecting much movement in the markets either. Though below 5350-5370 is shall be trouble time for markets.
Latest IIP numbers looked healthier than what it seemed to be in the month of January 2011. But the bigger worry remains the high crude oil prices which still trades above US $100 per barrel. This expensive highly imported commodity is something India will be keenly noticing.
RBI is likely to raise the repo rate by 25 BPS on 17th March in there mid term monetary policy review. So the market will stay in liquidity pressure for some more time.
As expected and mentioned earlier, markets may wait till April-May before resuming its up trend in market again. Till then expect consolidation and change in hands of shares within a range in market.
Strategy to survive in the market must be buy on declines. Know your stocks in advance, target them and pick your stakes in the stocks you must buy for medium term portfolio.
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