Indian stock markets have been roaring for last ten days. There is lot of optimism among traders. Highs are witnessed along with good volumes which indicate that the rally is strong and backed by the trading community. Everybody is being involved in this rally. From retail investors to foreign institutional investors, everybody is on a buying spree. But there are many who suggest not buying on rise.
There are still many who skeptical about this rally and raising questions regarding the sustainability of the market. I don’t think there is any expert who can tell exactly where markets are headed? But these ups and downs are part of a cycle where every event is repeated and followed. We were in a bull run till November last year but after that, market has been falling consistently.
They have corrected a lot after that and since March 21, stock markets have been rising every day. It may seem to be confusing but it is probably very easy, too. Stock market trading is all about patience. In one of my previous posts, I have spoke about the fact that this is good time for buying stock but after a rally of about 10 days, I think this is time for a pause.
It is a very good market for traders who can not only ride the upward movement but also downward movement, as well. It won’t be a bad idea to pick technically sound stocks and play with them in the short term. As far as long term investment is concerned, there is no problem with that. Long term prospect of Indian stock markets are still bright and they are going to give exceptionally good returns over a period of 1 yr to 3 yrs and more.
In the short term, caution and patience is the key to successful ride of the current trend. Do not invest in a stock or company in short term if you don’t understand its technical analysis, even if you are good with fundamental analysis. For the long term, fundamental analysis is good but in short term, always refer to its technical charts and indicators etc to figure out the current worth of the stock.
Technical analysis is the best weapon to figure out the entry and exit points for an individual stock. This is a time when you should keep reserve your cash because in case markets start falling, you can buy at that time. Currently, there are many which stocks which have gained a lot in last 8-10 days so verifying their technical charts and indicator is must.
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Thank you for sharing. Not to many people in your position are so gracious. Your article was very poignant and understandable. It helped me to understand very clearly. Thank you for your help.
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