During times of panic, nothing works. Everything gets slaughtered as market participants run all over the place. The guessing game then yields no result. That's why Avoid call works best then. But there comes a time when things start settling down and normalcy returns. The good news: It's happening.
It's time to say Thanks to S&P 500 for holding 1810.
Bearishness on one side: S&P500 is up more than 5% from the base of 1810https://t.co/yzggZY30Tz
Charts give you visibility
— Deepak Singh (@smarket) February 17, 2016
I did point to the importance of holding 1810 level on S&P500 on Jan 24 2016 in the post titled - "The comfort of S&P500". The reason then was the S&P500 bounce from 1810 (Jan 20 2016). The same thing S&P 500 did again this time from Feb 11.
The S&P500 rallied 2.8% last week. After this bounce from 1810 - here's how the big picture on S&P 500 looks like on weekly chart
The S&P500 has now very solid base at 1810 and now even 200-week moving average seems to be catching up. Even though the S&P 500 is down 6.2% for 2016, one can still hope for recovery as long as 1810 is intact. This stability in Global markets helped Indian stock market too especially the Nifty. This was the reason I wrote this article last Sunday
In case you missed it - Nifty is right now standing at the ULTIMATE support level https://t.co/ye533VhNMN
— Deepak Singh (@smarket) February 15, 2016
This is what Nifty did on weekly chart - a decent bounce of 3.3%
I am in no way suggesting that risk has disappeared and everything is good now. All I am saying: there are early signs that things are returning back to normal.
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5. The story from Last Budget to this Budget
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purpose. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers