Dear Investor,
Overall market is not looking good. Its very clear. Daily gyrations and struggle to pick the stock at bottom is crushing many people. People just can't accept that market is downtrend. Its very obvious but we want to ignore it. It has happened in past and it will happen again. Next week will come with few surprises. One of them will be linked to Greek bailout and we will see markets see saw. Suddenly there will be a day for great rise or a day of great fall. This market will not make money for anybody. It will only catch you and let you think for a long time in your life. I have been repeating it for past three weeks, let it go. Let it alone and just be a obedient observer of the play. It will unfold in mysterious way. Reason is simple, there is no real conviction about the global growth anymore.
I bring this chart up for you to learn, how a true bottom is formed in downtrend. Downtrends go through phases of sell of. Look at any stock charts and you will know that why I am stressing on downtrends. Downtrends is when you will not make money. Stock will move up for few days only to go down more. Simple indicator you should look to check the health of market is check stock of Infosys and Reliance. Are these stocks moving up words. If the answer is no then you know, smart money is leaving market and parking their money somewhere else. Above chart the bottom blue color band is where bottom was formed. Even though it looks like we had great sell off, we are no where close to the 2008 bottom valuation. Current correction is tiny compared to past years rise. Time when you throw money at any stock and double it is gone. That was unusual time is stock market history. These kind of situation arise only once in 25 years. Now you have to learn, how to make money in stock. Wait for proper market uptrend. Do not guess bottoms.
Above daily chart of NIFTY clearly marks the downtrend in general market. There will be few up and down days but we need to wait for going long in this market. There is no panic selling yet. Masses are still holding on well that means the bottom is not in yet. Keep close on European news. It will all depend on that. As of now the news is not encouraging.
Thanks
Anil
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