Nifty trend today / Nifty prediction today 20th March 19
Nifty trend today was bullish though in the first half we did see some consolidation and in the second half Nifty did move higher. As per my Nifty prediction Nifty trend remains up as of now however markets are getting stretched and it is a matter of time before it will snap hard but keep in mind that this does not mean that the rally will end tomorrow it sure can extend for a few more days so until and unless we have a trend reversal we should not be short selling, however, keeping in mind the extremely rich valuations, time cycle factor as well as looking at the price charts reducing portfolio longs should be done especially where stocks are richly valued.
Many of you have been calling me for the past few days and telling that though Nifty is near all-time high their SIP’s and mutual fund returns are negative. The same story goes with the investors who have parked money in PMS fund or for that matter invested directly and there is a reason for that happening. If you see the ads most of the brokers or the mutual fund community is advising to invest consistently in the markets however in our wealth creation analysis the people who have made money in the market have always one thing in common and that is that they have bought the stock cheap or invested when the markets have been in the dumps, the second factor that has made money for these investors is that they have bought high-quality names which have good management, near zero debt companies and companies where they had clear visibility of earnings growth. Now, most of these simple rules have not been followed and hence most of the portfolios have lost significant amounts of money. Now some of you may be thinking why am I writing about this as of now I am communicating this to you because of the fact that there are many investors and traders who are trying to play the election rally and will eventually end up with some or lot of stocks which don’t fit the simple wealth creation formula and hence will end up losing money in the market so keep in mind that we are at a point in Nifty where the valuations from a broad stock market perspective are not cheap any more sure there are some select names where deep value is present however we don’t see that value across the board and hence investors will not make money if they approach a buy and hold strategy across the board for now because regardless of who comes to power once the event is out of the way investors will have to take stock of the high valuations and slowing earrings outlook, struggling economy and in such an event we don’t see stocks broadly speaking doing well and giving much of returns again we are saying that there will be exceptions to the rule because there are some stocks at deep value but overall we don’t see that the broad market so if you are trying to play the pre-election rally be very nimble footed and trade accordingly.
If you are only trading on the basis of this post please use your own risk management and then only trade please do not over trade and always keep your risk in check before trading or investing.