Most of those who read my tweets will be aware that I start looking for tops and opportunities to go short whenever Nifty goes near 6100 and above. This belief that our market is not yet going to run away comes from a long term chart of Sensex (Nifty came much later, hence the study on Sensex).
The yearly chart of Sensex is the reason for my bearishness at the levels mentioned above.
Although I believe in the science of 'waves' I do not think I have the expertise to apply the study on our charts.
However, in my view, even a simple longer term view of the same charts, gives a different picture than just studying short term charts.
To keep it simple, Sensex might be showing a period of consolidation in a broad range.
Those following Nifty alone might be under the impression that it gave a breakout when 6181 was crossed (that was the January 2011 high). However, high of Sensex in January 2011 was 20664.8 and the high in May was 20443.6, which means Sensex DID NOT give a breakout.
This is the reason I feel, our market is in a mode of consolidation similar to what it did from 1992 to 2003.
Whether this will take that much time, is not possible to say, but if one believes in the 'consolidation phase', our market needs to go and test the lower band of the broader range (4000 to 6200) over the next quarters.
Yearly chart of Sensex:
The yearly chart of Sensex is the reason for my bearishness at the levels mentioned above.
Although I believe in the science of 'waves' I do not think I have the expertise to apply the study on our charts.
However, in my view, even a simple longer term view of the same charts, gives a different picture than just studying short term charts.
To keep it simple, Sensex might be showing a period of consolidation in a broad range.
Those following Nifty alone might be under the impression that it gave a breakout when 6181 was crossed (that was the January 2011 high). However, high of Sensex in January 2011 was 20664.8 and the high in May was 20443.6, which means Sensex DID NOT give a breakout.
This is the reason I feel, our market is in a mode of consolidation similar to what it did from 1992 to 2003.
Whether this will take that much time, is not possible to say, but if one believes in the 'consolidation phase', our market needs to go and test the lower band of the broader range (4000 to 6200) over the next quarters.
Yearly chart of Sensex:
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