This is what we wrote to our clients today, in the daily letter:
Indian markets fell sharply, closing below 5200, in fact well below this support level, at 5148. The bearish head and shoulder which we have been tracking has been confirmed by today's price action. The pattern target for this move is 5000, although I suspect that the Market may actually fall lower.
We may well be entering a deep correction.
Buying opportunities are likely to emerge whenever the correction gets over. Please remember that a one or two day rally will not be a sign of an end to such a correction. patiemce is the best friend of the Investor. This column had advised liquidation of all shares held on your trading account when the Nifty fell below 5270 two weeks ago. For your investments, we suggest that you switch from low cost small caps to blue chips. There is no hurry. We will provide you with a list of stocks where such switching can take place.
Look for opportunities mainly on the short side. Again, buying on dips is possible in selected stocks which show relative strength. We will provide readers with our own list, soon enough.