Personally I don't trade on fundamentals - only big players can afford to do that. But when the fundamentals and technical are at such variance then I examine the situation very closely for a trade opportunity. I had a successful trade yesterday and today with Trump walking out of the Iran deal lets see what happens. The markets are likely to cool down especially with Karnataka elections coming up. And ICICI went up over 6% so it will probably correct today. Cheers.
I tried to resist but could not help in sharing my view strictly on that point. Karnataka Election is a state election and state has little to do on central law makers. Why market should be worried? I think people holding high premium stocks in mid and small cap will not easily sell those irrespective of the outcome of Karnataka. Sectors like IT, consumer durable like (Autos) and first moving consumer goods will probably remain expensive (after implementation of GST). The most politically sensitive stocks should be from banking sectors,Oil and gas, and Infrastructure stocks and those have never been appreciated over past so many years. HDFC bank will always remain in buyers list irrespective of Karnataka result. Oil processing companies are now probably value buy, those are already down. A few stocks like Maruti etc have already corrected and gone to oversold region. It will be very difficult to get stocks like PAGE industries ,DEMART, MRF, etc at cheaper price and those types pf stocks have received some kind of image making them costly. People holding them will be reluctant to sell them on the basis of an election. (state or general election in 2019). Rather they will be costlier even if one or two quarters they perform badly. All logistics companies are making new lows even in this extended bull market. Pharmaceuticals companies are probably value buy. So where is a chance of correction with Karnataka result?
As long as global market remain strong with low inflation and rate of interests on fixed deposit or PPF etc in India remain low chances is market will move higher... . In 2006/ 2007 crude was 80-120 range but that didn’t influence the market to move higher and higher till the bubble burst in a place far from India. Am I missing something? With regards
- The seriousness of the Iran issue is yet to play out. India will be badly affected if it escalates - Iran is our top 3 oil suppliers. And there is the Chabbar Port issue...
- Europe and the US will get into complications in their relationship
- The dollar and crude have shot up as a result of the Iran issue... our balance of payments will get hit... FIIs may temporarily withdraw from India and emerging markets
- Nifty has been on a roll since 23rd March... How long will it go on without any significant correction?
For all this however... I check the momentum and technicals and go with that alone... People like us cannot afford to go on fundamentals - that is for the big boys... who control more than 80% of the market.
Market may not fall If and only if global situation doesn’t worsen much but might remain in a plateue for a considerable period of tme what you technical experts call as sidewise reaction, whatever be the result of 2019.
But, may be even fund houses or Institutions will not sell stock like TTK prestige etc those are so called overly priced.
I find the dark cloud over the sky from my window and believe it is better to avoid taking put options thinking of Karnataka. If Maruti tries to push then it can itself has the capacity to lift the market after 15th May with the hope there will be good distribution of rain.
It is the global market that we need to look at it more to trade on Indian market.
You are always free to correct me if I am missing something.
I found that suspicions and went long on 23rd October at about 245 (futures price). On 25th I closed at 320!! DII's and FII's can certainly play against the retail trade and make profits even in large volume counters. Some indicators like MFI, Renko etc can give a hint of what the smart money is doing.