Nifty at 4747, what should you do now?

Aug. 27, 2011 - PRLog -- Mumbai, Maharashtra, August 27, 2011 /- FAMS Group Chairman and Managing Director gets candid about his views on the global economic scenario and what he expects in the coming days ahead.

The following is a snippet of the consversation of Mr. Mubin Panjwani, CMD FAMS Advisors Pvt Ltd:-

We have seen a huge market fall in the month of August 2011.

The markets have tumbled from 6100 levels at the beginning of this year to 4700 levels till this week of August 2011.

You can see the chart photo on https://www.facebook.com/famsapl?sk=photos (under Market Outlook folder, the Aug 26 2011 photo)

What we can see from this chart is that once 5600 was broken, the market first looked to break out from this level. The markets achieved this in second half of March 2011.

The market again fell below 5600 levels twice, once in early May to recoup over 5600 by June end, and the second time was during the end of July 2011.

Due to the global problems of Europe debt crisis and US slowdown, the world is into a panic mode. Gold has risen USD 400 in a matter of couple of months as it is seen as the most safe heaven. Some analysts predict that gold will rise to USD 4000.

We at FAMS feel that a cool off (not going down drastically, but stagnating at around current levels) for some time will take place in gold. However we feel Gold could see a rally to USD 2000 first and if situation does not improve then this could further heat prices of Gold to USD 2500.

Coming back to our Indian Markets, post end of July, we have broken many support levels. First it was 5600, then came 5200. Many analysts spoke of 5200 holding, but we at FAMS stayed on heavy cash levels as we did not see signs of relief.

After 5200 came 5000, which was taken out with a vengeance. The most recent level predicted by many analysts was 4800 level on Nifty. However this Friday saw this level taken out as well. We now stand at 4747 level on Nifty.

As per our chart levels and our analysis, we are now comfortable to go out and cherry pick the FAMS favored sectors and stocks. We expect that in most cases 4720 level should act as support. However we do not rule out the probability of Nifty seeing its next level as per our chart of 4520. As this level, 4520, is not too far off we would look to start nibbling at the right stocks from this levels.

Also the speech of Federal Reserve chairman Ben Bernanke has not mentioned any QE3 as of now, but has mentioned that they will work together for US to regain its economic boom owing to strong fundamentals.

FAMS Team
http://newfamsapl.blogspot.com/
http://www.facebook.com/famsapl
http://twitter.com/FAMSAPL

# # #

About FAMS Advisors Pvt. Ltd is a fast growing financial services company established on the basis of trust and wealth creation for all, offering asset management and research services to help maximize returns from the stock market and minimize risks. It is headed by value based proprietary investor Mubin Panjwani who has been a fundamental value investor in the Indian capital market since over half a decade.