The CNBC-TV18 Investor Camp at Kolkata on Saturday Janaury 24 was a big success. The large hall was filled up. More important, the people who came were cheerful, smiling and willing to listen. Cheers for Kolkata citizens.
Market loses for second consecutive week
The Nifty closed at 2672, the lowest close in 14 weeks. This is not good news. Lower closing levels suggest weakness in the market.
Possible Downside Targets
A trading range (3150 - 2800) breakdown suggests a target of 2450. Since this breakdown has occured in the direction of the primary trend, it is possible that the final target may be lower than 2450, since targets in the primary direction tend to overshoot.
Not the time to invest
The time to invest will come, but this is NOT the time. As the Market searches for a base, it is likely to see, sharp volatile down moves. Fresh investments should be made ONLY after the index shows signs of base bulding. This has not happened yet.
The banking sector has seen the biggest losses in recent days. This was the sector that was outperforming a few weeks back. There is a message here. No sector can be assured of better returns while the bear market rages on. Thus, we cannot say that this or that sector will act better. The sectors that will eventually lead the next bull market will be discovered only after the bear market shows signs of exhaustion.
As I write, the infrastructure sector has been out performing. This sector does suggest a buy strategy, whenever the current decline ends. Such a strategy is only for short term trading. Companies include GMR Infra, GVK Power, JP Assocs, ACC, BHEL, BEL, ........
Wait patiently for the selling to be over. Somewhere around 2450, we should see the first signs of market exhaustion. On every up move, the Nifty is likely to face resistance. Immediate resistance comes around 2875. Be prepared that there may be much more pain ahead. It is difficult to predict the end of the bear market now.