Why not ? Nifty can very well retest the prev low of October or it can even go below that. In such a strongly bearish sentiment all around the world, I struggle hard to find any convincing reason to be bullish. IMO, we are yet to see panic selling. Market has been down for almost 3 to 4 years during depression period /major bear mkt. We have been down only for 12 months so far.
The world is just coming to accept that we are in a big big mess.. Most of the people have not seen such a big mess.. so it is anybody's guess that it is going to end soon.
From tradings perspective, monthly/weekly charts are not giving any sign of reversal so I am staying with the current trend which is down. I will rather wait to bulls to comeback and show me on my charts first before I change my opinion to bullish.
Happy Trading.
Yep, you are right that markets have been down by almost 3 to 4 years, and we have been down for only 12 months. But thats just time wise. If you see price-wise, we have already retraced about 50% from the all-tim highs which is as much as any bear markets.
As for the world accepting that we are in a mess, it had always over-reacted to downsides, as it had done in May-2006 or in the late 1990s. But every time the markets were successfully able to climb back and surpass the previous highs. You can go to
http://dshort.com/ and you will find all major bear markets from historical perspective.
To rajatheroyal: As for Nikkei and the Dow-Jones 1929 recession, you have only two examples when the Bear was a chronic phenomenon. But in case of most other bear-markets, recovery was much earlier than that. So whatever the present conditions, the historical odds definitely favour the bulls.
Correct me if i'm wrong. Historically except Nikkei there is no other market in the world which has failed to come out of any prolonged bear-market, why would'nt they out of this one?
Cheers.