Thursday, September 22, 2011

Risk is Off Again

Stocks and Silver are getting slammed as the world moves away from risk. The Nifty saw a dramatic decline all the way to 4900. All trends see some kind of corrections. The rally from 4700 to 5200 was a correction of this bear market - a relief rally.The Intermediate bear trend seems to have finally asserted itself, with the relief rally probably complete. The Nifty seems on way to challenge its earlier low of 4700, and, eventually break below it.

A large head and shoulder pattern earlier discussed on this blog has an approximate target of 4000. This pattern remains valid.

For investors, the wise trade is to do nothing - just hold on to your cash. For traders, it is wise to follow short term charts and go with the intermediate trend which will change to down, if and when the Nifty closes below 4900.


1 comment:

rohit said...

Sir what is your view on the rupee, because if rupee is in a bear market, stocks will also go down, if you see in 2008 re went till 37-38 but this time around it did not, people say it can fall to 65 vs $, and a correction in gold prices in dollar terms is not helping indian investors who want to buy at lower levels because re weakness is supporting prices., one more reason why people must invest in gold, if dollar falls gold prices will go up and if dollar rallies, because of re weakness prices will have some support. Nifty might find some support at 4650, but i Feel 4300 might be the bottom as of now, but who knows if greece defaults we may break 3800!!!