Thursday, February 03, 2011

Missing the technical bounce-back on Nifty

Indian markets had a technical bounce back and I missed it! At first I was expecting some kind of a pause at 5400 on Nifty. However the type of fall in the markets over the past few days coupled with the volumes had me in a fix. It looked like markets would simply drive through 5400 and land somewhere closer to 5300 or lower. So I had invested not more than 10% of the cash. Nevertheless I exited out of my positions and will patiently for levels of around 5200 for another mini-bottom.

Meanwhile, as we discussed earlier, the market is on track to form first of its two corrections. To quote my earlier post:
We will have two bottoms and three tops during 2011. Depending on how you look at the cycles, we had 2 or 3 of them last year. Consequent to the cyclicality, portfolios will have to churn thus leading to healthy performance of the brokerages and investment banks. I would expect asset managers to have a decent year again.
I believe we will be set for the peak around May-June or thereabouts and a correction around September. It is possible that the September correction will be shallower than the one we are experiencing right now. Naturally, I expect alert fund managers to have a decent year in calendar 2011. In these views I am contradicting most experts and talking heads.

Note & disclaimer:
This is not advice to buy or sell or trade in any security. Please invest post careful research and analysis. I will not bear responsibility for your actions.

My book "Subverting Capitalism & Democracy" is available on Amazon and Kindle.