NIFTY closed at 2009 high of 4804.10, up 2.3 pc in a broad market rally, again led by the midcap and the small cap index.
I think we have just moved from the “Today” phase to “Tomorrow” phase as outlined in this post (“Watching the Tape”).I would recommend you to read my last blog post (“State of The Markets”) to inject a healthy sense of cynicism.
Of course, the “Today” phase has ended a bit sooner than my taste, but then the market really doesnt care of what I think or do.
Also, I think, I panicked a bit too early in case of China, and swayed away from my initial analysis. I am no doubt bearish about China(as mentioned in “Watching The Tape” and others),but this is a time for cautious longs in the entire global equity market. I see, the next financial year to be a time when Chinese will find it increasingly difficult to keep its faux-debt under radar. I was cautious at that time, very cautious to say the least, because usually the times when you see, bubbles getting pricked at one geographical area, yet the party seems to go on, is when you should pack your bags and leave.Yet, inspite of my experience, which said, consolidation/sideways movement doesnt lead to crashes, I erred on the side of caution. I am not bothered, since I just kept my stop losses tight and didnt exit what the system didnt tell to.
Today as I move on, I am not an optimistic bull, but a very cautious one, ready to change my stripes to a bear anytime I see an uncanny euphoria. I would suggest you to do the same and not forget markets run on doubts not on euphoria. Be long, stay long in this market, expose yourself to ETFs, they are far better, cheaper and transparent than mutual funds.
Adios!
Soham
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