Tuesday, November 1, 2011

Return of Common Sense

WIll Europe allow its economy to be devastated for a Greek loan of US8 billion? The obvious, common sense answer is: certainly not.

Markets will go up and go down. For many reasons, traders will be bearish / bullish and so on. But, the end of Europe should not be a reason to become bearish. Because, Europe is NOT coming to an end.

European and American markets have just seen the best month for bulls since 1987. Surely, markets will consolidate, become choppy, go through dips after such a spectacular rally. That should be a reason to expect a decline of sorts. But, Europe coming to an end: No way.

10 comments:

Gullapalli Sankara said...

This crisis is mainly concentrated in few southern European countries. Even Northern European countries like Norway, Sweden etc are not much worried about this crisis.

rohit said...

Sir greece has defaulted 5 times in the last 100 years, but the world has not ended but that does not mean that markets cannot go down 20-30%, should one start shorting tomorrow once we break 5200?

rohit said...

What is the dollar chart looking like? will it surpass 80 and also the rupee? Is it likely to go to 52-53?

Nandita said...

Very interesting and important informative article. I also agree with your view.

Retail investors should not carry away with a small dip and entangle in a Bear Trap.

Jaishrikrishna said...

Nice to see u back on CNBC :)

SWEETY said...

Your article started with saying:**WIll Europe allow its economy to be devastated for a Greek loan of US8 billion?** --

Do you mean to say only USD8 billions?

This is a wrong information.

During 2010 Greece's Public Debt 329.4 billion Euros - which would grow to 355 billion Euros by end of 2011 -- that are 144.9% and 162% of the GDP for the respective years.

And then what about Portugal / Italy etc.. they are also in deep debts.

Also, we are conveniently forgetting about our own problems like ever growing inflation / higher interest rates / corporate growth slowdown / depreciating rupee --- We are yet to face the real shivering effect from the European crisis.

It would take a more quarters to get the real bottom and many more quarters to do consolidation.

Where is the real bottom? Can anyone say confidently at this present movement.... Will they put their hard earned money at this present juncture, assuming that they are investing at every dip.

It is easy to say buy buy at every dip... but the small / retail investors are staying faraway from investing in equities. Only puters / speculaters / short term traders are ruling the roost in this market.

amarjeet said...

sir
please explain on bata india i want short on it.i think now in correction phase.

abishekrav said...

can you explain distribution selling on the charts...how do you distinguish between a consolidation at the top of an uptrend or distribution selling leading to a correction..i looked at your aban chart...ttk prestige is doing the same but at the top...can you put it up on the blog

rocky said...

SIR ji long time no update can you share the links of your views on cnbc here too...

Kuldeep.rk said...

Dear Sir,
Bullish H&S on SBI Daily? Target 2280 - 2300 ?