Why I think the Indian market fall is not sustainable

a) Oil is not at all the reason of this carnage -
If you remember, in 2005 2007 oil climbed up from 40-100 dollars a barrel and SENSEX moved up from 6000 - 20000 but in 2008, when the oil price went more up from 100-130, SENSEX came down from 21000 to 15000.

In 2011 the oil price was at a very respectable price of $115 and even at that time sensex was lower than 16000.

And finally in 2015, when the price of oil was tumbling like anything, SENSEX made a new high.

Do you see any correlation ? I don't see any.

b) India's fundamentals are very good -
The International Monetary Fund (IMF) and the Moody’s Investors Service have forecasted that India will witness a GDP growth rate of 7.5 per cent in 2016, due to improved investor confidence, lower food prices and better policy reforms. Besides, according to mid-year update of United Nations World Economic Situation and Prospects, India is expected to grow at 7.6 per cent in 2015 and at 7.7 per cent in 2016.

c) Chinese Crash is actually good for Indian Stock Market
Chinese crash will probably divert the foreign investment traffic towards India from China. So I think it is an angel in disguise. India is very attractive in terms of fundamentals. I would not be surprised if our country makes a place in Top five GDP countries in the next 5 years as many new outstanding businesses are also emerging. Considering all this I think sentiments will boost up by mid term.

Bottom Line: Since we are mankind, we feel more secure being a part of the herd. No matter even if the herd wants to jump from a cliff. Right now I can see that the herd wants to SELL and that is what most of us will be doing now and get financially injured. Media, Brokers and some analysts are the people who can even justify you how Ice can produce Fire and why the white color is Black. They always have a reason.

Listen less to them and more to your own intuition. Here no one knows anything. Behind the curtain there are many individuals and groups that have vested interest in spreading rumours. Public hardly knows even 1% of all that. Friends, just use your own brain and make heavy money from the market. I don't think this fall will sustain more than a few weeks or months. I strongly believe that a new high will be made in 2016 only.

Your friend,

Guru Vachaal.

SENSEX 24455
NIFTY 7437

 

VERY GOOD ANALYSIS of situation. 100% Agreed with views

 

Market may revive but poor stocks may not.After this fall ,market will be more skewed towards good quality compnies and Fathers of Duds may have tough times ,with large speculators now as orphans of Duds.

 

I don't think so. Even junk stocks will also follow the market when it wil make new highs. Although I strongly advocate to buy only quality stocks.

All I want to say here is that the current fall is not sustainable and market will reverse very soon.

 

I don't think,look into poor infra and realty stocks of 2008 boom,Punj Llyod,lanco,gmr,IVRCL,,DLF,Unitech ,rpower,adani power,suzlon and many 1000 more similar Duds.I think Fathers of duds may be wiped out and will be spent force with butchered followers.

 

Warren Buffett once said: - Often do nothing.

Selling may be incorrect but buying is also not correct.Some are buying as if major bull run is starting next week. If anybody wants to buy then it is okay to wait for some time or buy in very small quantity. We will not miss any opportunity.

I think it is important to wait. Do not buy and do not sell. Just wait. Tomorrow i.e. 19th January, China will release its economic data. Market is expecting that China's growth will fall down from 6.9% to 6.5%.

So if tomorrows data is as per expectation or above expectation (6.5% or above) then market may stabilise. Or else fall may continue. So let us wait and watch.

 

San8422....very sensible advise.

 

guruji you are right that markets will rebound in short time.

 

Small Cap Index has almost reached the support. I see a speedy recovery till previous levels within 1-2 months.


SMALL CAP 10345
SENSEX 24188

 

Inshallah! If it happens I will be happiest man in world !

 

No option but to follow such advice because there is no money to buy. Otherwise I could have tried SIP.

 

me too guruji

 

Expect media to come up with bullish analysts soon.

Even porinju has the same opinion. He tweets that you will be surprised to see the current market low after 2-3 months.

As I have predicted earlier as well that sensex will make a new high in 2016. That bullishness is intact.

Just ignore the crook media. This is not at all 2008. You may wish to switch to quality stocks in case you have any junk stock in the portfolio.

The most relieving part for me is that the public is expecting a slowdown but interestingly public can never be right.

Drink some water with a chillpill.

 

So our strategy should be: -

1. In case of quality stocks: - Wait and Watch. Buy after market stabilizes.
2. In case of junk stocks: - Sell and book losses. Keep the cash in bank. Use it to buy quality stocks after market stabilizes.

 

I agree with guru just buy buy buy sell everything you have and buy stocks very soon I would responding to these types of messages on my iPhone till then the Chinese phone will suffice to respond on the market crash due to china factor

 

Does ...... has any other choice but to tweet like that and see Tom and Jerry ......???Inspite of what he tweets and see ,I am still hooked to business channels (dont feel need to see Tom and Jerry at all)as I can still recognise mine Strong Quality Portfolio ,which is also some what down but showing resilience as compare to rest of market on basis of Quality . I hold the STRONG VIEW that now it is Dead End for third grade,illiquid,Unknown stocks with poor fundamental compnies.I know operators may try to push again these compnies when market settles.But that will be to trap small investers during dead cat bounce and dump there illiquid Duds.But these Duds will then again come down like bottomless ,never to recover again.So better to liquidate these Duds to operators during dead cat bounce and shift to blue chips larger names and sector leaders and say GOOD BYE TO DUDS and leave these to operators to pass these duds to their childern to show that they had to share their fathers with Duds..To me they will be known as Fathers of Speculative Times .Investers will be more skewed towards Quality now onwards after this carnage, so only Quality will bounce bank finally and may be fast .This is no recommendation as always but only private view for discussion with great respect to all including Market Gurus and persons with opposite views.

 

guruji budget is on feb 29. i expect a decent run up before budget is presented. i may be wrong but i expect so.

 

China's growth was 6.9% for 2015 which was in line with expectation. Even better, China grew at 6.8% in December 2015 quarter. Many analyst were expecting China to record a GDP 6.4 or 6.5% in December 2015 quarter so China's performance in last quarter was better than expected. This confirms that Chinese economy is not in recession.

Also oil prices may not fall much. It may even rise. So I think worst is over and market will stabilize soon. Still I will wait for some time before I start buying.

 

I see a green hammer like candle forming in the daily charts of small cap index. If it closes at a respectable price, it may symbolize reversal. The aforementioned support seems to be working good.

 

I have already started with my SIP in Selan Exploration and Jindal Drilling. Although I am not hunting for the bottom and don't really know where the bottom is but seems to be around the corner.