It was a great relief to be away form tumultuous markets in last one month. S&P swung between 1150 -1250. Surprising factor was Nifty which did not made much movement and even when S&P is trading 200 points above its lows, Nifty is making new lows. This indicates a tremendous bearishness in Indian markets. It seems so surprising that just few months back everyone was bull on India and how economic factors and investor psychology change overnight. My own assessment is that Nifty can go below 3800 if not lower in next year. I am very bearish on Global Macro factors for next few years.
The first chart I am going to present is of Athens stock index. People may find it hard to believe but even Index can fall up to 90% if the country do not have option of money printing. Athens stock index which made a high of 5000 in 2009 is today trading at 680 down by almost 86 %. This chart is just to point out that stock prices can correct severely even from current levels.
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| Athens Stock Index |
The second chart is that of Gold. I have long maintained my bearish stance on gold. Gold had currently broken the trend line which was supporting it since 1000 levels. The correction from here could be up to 1300 levels. I would again reiterate that gold would be a great buy between 1100 -1300 levels with stop loss of 850 and target above 3000 in next five years.
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| Gold |
Silver is also following a similar pattern and had taken support at long term trend line. Any break below 26 -28 levels will result into further fall up to 20 levels but just like gold I think silver will be a very good long term buy at those levels with target above 100 USD an ounce in next five years.
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| Silver |
The current chart is of INR which continue to loose its value against USD. I am very happy to be among the few analyst who foresaw the coming decline. I reiterate my target for INR which will reach 55 (almost done) to 60 levels against USD.
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| INR |
The last chart is that of Nifty. Nifty is forming very bearish pattern. If nifty goes below 4700 than it will correct swiftly up to 4250.
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| Nifty |
