iCharts Discussions

[ktpillai]

[svkum]

HDO-
Yes i fully agree with you that a long term approach to wealth creation should be , a study of fundamentals and overall economy .
The study can be bifurcated into ,
World economy
Indian economy
oerall growth prospects of business
Growth prospects on sectors
growth prospects on industries and companies.

After carefull analysis we can take a right approach ,towards investments.
When this should be done, that technicals would be able to help.
So Harish no need to be nervous if yu dont get a audiance with real interests in the subject.
Perticular set of people wd definitely apploud your effort and participate also who knows?
S V KUMTHEKAR

[vivek999]

Dear Harish,

I believe that you started posting your technical analysis on this forum, out of your own interest. After that, fellow-members started participating. I think you should use the same approach for posting your fundamental-analysis, as well. Please post your fundamental analysis. When fellow-members start liking it, they'll ask for more.

Best Wishes,
Vivek

[hdobhal]

Dear RR Sir, Ktpillai Sir, Svkum Sir and Vivek Sir,

I am very happy for the encouragement which all of you showed. What I wanted to do was to post my thoughts about "CAN THE US AND WORLD ECONOMY RECOVER SO EASILY" as most people think. As my idea has already been delayed by two days, I am copying the it directly from my blog:

I am a firm believer in Economic Cycles in Global Economy. This means I believe in economic conditions riding on repetitive cycles in Global Economic Activity. To express in simpler terms all events including economic activities occur in cycles - meaning they go up and down with a set and defined set of parameters. The most important of those is the time factor. for Example, an economic cycle goes up and all the economic activities represent a boom and then after some time it goes down and there is a period of depression. In the space between the two there are times of slow growth, stagnation, recession and sometimes stagflations. The recorded history of we human beings is witness to these cycles. There have been great economists throughout our history who calculated and predicted the cycles. One of those is my favorite Professor Nickolai Kondratieff (1892 - 1938) of former Soviet Union. In 1926, Kondratieff published his findings in a report entitled, "Long Waves in Economic Life". According to the report a long depression in the world economy is overdue. The downturn should have started in 1990s !!! For all those who want to know about the great Kondrateiff, all the information is here - http://www.kwaves.com/kond_overview.htm

What happened to the cycle? why was there increasing prosperity in US in the period and and later in other areas of the globe? I was as confused as most of the economists were.

To recollect facts, there was sure a start of downtrend in economy in 1990. In the month of June, 1990 a recession started in USA but it ended early next year - 1991. That is official. The recession was mild in nature and there was not big damage - again official. But not all agree with that.

Some well known economists say the recession was far too greater in magnitude than told officially. Dr. Ravi Batra, a renowned economist explains it like this on his website - "The truth is that the slump of 1990, though not a full fledged depression of the type in the 1930s, was much more serious than revealed by official figures on output. The public said so at the ballot box and threw a once untouchable president out of office."

Harvard Professor Galbraith called it a recession cum depression

Economist David Levy said it was a "contained depression."

Lawrence Hunter, deputy chief economist for the US chamber of commerce, dubbed it as a "never-ending recession."

Peter Peterson, Commerce Secretary in the 1970s, called it a "middle class meltdown," and Wallace Peterson, a distinguished professor at the University of Nebraska, titled it the silent depression.

Even Massachusetts Senator Ted Kennedy, not a critic of Bill Clinton, described it as "quiet depression" as late as 1996.

The above quotes have been sourced from Dr. Ravi Batra's website which you can find at www.ravibatra.com

So, the worldwide impression is - the US brushed aside the recession and in fact prospered in the 1990s. That is true if we see it partially, but the fact is different.

In 1990, there was a crisis in Japan also. The Japanese Stock Market crashed in the start of 1990 which led to start of interest rate cuts there. The rate cuts should have started helping the slowing Japanese economy but it did not do that. What happened in fact was that this rate cut led to flow of money to the US, which was in need for it. The US current account deficit was growing leading to a host of countries having a big reserve of US Dollar. While the US economy should have gone down with the slowdown / recession, the inflow of foreign funds turned it completely and the trade deficit turned out to be a blessing for it!!! Japan continued slowing, the dollar reserves of some countries kept growing and US had a boom!!! Then there was the Asian crisis in late 1990s, which affected US more positively as falling interest rates led to the well famous (now infamous) Housing Boom. A housing boom creates demand for many other things and economy experiences the best boom times.

So, what could have been the start of a big bust, actually went on to grow into a big boom, increasing prosperity that also spread worldwide later.

Anybody who has the very basic knowledge of economics, should know how money is created in today's world, but only few think about it. Its just a virtual money which is created by debt!!! To put it in very simple words, there was time when new money could be created when there was a reserve against it - like gold, but that's not the case now. All over the world, the practice is that Central Banks keep a FRACTION of reserve of the "money to be lent" by Banks. This fraction averages about 10:1. This means for lending 10 units of currency, the Bank needs to keep only 1 unit in the Central Bank. This simply means 90% of pure virtual money out of thin air !!! This practice had been doing well so far as the new money created was financing new economy, but, now the time has come when there are chances that this very practice is going to lead to the biggest bust in the history of human beings economic growth. Please visit this website http://www.moneyasdebt.net for a thorough information on Money As Debt You can also watch the video here http://video.google.com/videoplay?docid=-9050474362583451279 which is very nicely compiled and very informative. I bet all your queries regarding money creation will be solved !!!

Now, coming the question again - was Kondrateiff right? I think he was right and once again we are just sitting on an unstable rock put on a high cliff. We have only managed to POSTPONE it so far, but we can't do it forever.

Dear Friends, I want your comments - good or bad all. So please post your valuable comments.

Thanks & Best Regards
Harish Dobhal

[hdobhal]

Friends,

Look at 4460 on Nifty, if it manages to get past it and remain above it for three days then 4600+ on cards, But failing that it can be all over for bulls...

Harish

[ramtrade]

Harish,

My take is market will see 4300 levels soon.

Thanks
Ramesh

[rsnagesh]

Dear Mr Harish,

Good collection of informations and interpretations. Being a firm
believer of fundamentals, I liked it and the way it was presented in.
Good work sir & Keep it up and continue to present this kind of
economical-cum-fundamental approach sir.


With warm regards,

(R.S. NAGESH)

[marne.vivek]

hi all,

sorry i did not post my work here, i thought i would post here as well, but got tired of uploading the files.

pls refer the work in :

Forun > Technical Analysis > Elliot Wave (author mayur) > Nifty Elliot wave (by marne.vivek), uploaded 9 pics and one word file.

sorry for the inconvenience,

regards,

[hdobhal]

Thanks Mr. Nagesh,

Vivek, its good you told about that here, it will benefit all the readers...

My view is that today again, Nifty tested the 34 Day EMA and the 38.2% retracement zone (though it is still well above that). NS going below 4270 will be worry for bulls.

My opinion is still the same - This is a Primary Bear Market and these kind of rises are only giving opportunity to short sell.

Harish

[hdobhal]

Dear Friends,

Its not easy to tell about the Stock Markets direction and see how it turned out (at the time of writing this post) for US markets. I'll come to that later, for now read about Nifty...

For Nifty, Yesterday it was 38.2% and today it was 50%. Yes I am talking about the supports Nifty was taking. Look at today's chart and you can see yourself. I have following observations:

1. Nifty broke yesterday's low and took support at 50% retracement of previous rise.
2. Nifty broke the 34 Day EMA support and is now around 13 day EMA.
3. The volume for today is slightly up.
4. The FIIs and DIIs are both net sellers in today's trade.

Conclusion: If Nifty manages to sustain above today's low, it can show a bounce back. If it goes down below today's low, then the next support is around 4080 levels (61.8% retracement). As I told here yesterday, I am still bearish on the larger trend.

I have to mention that at the time of writing this post, I see US markets kind of rallying. I was almost sure yesterday that there will be further downside in US and I am still for it.It looks like yesterday's sharp fall in Dow Jones and S&P 500 made it oversold and now its a very small rally undergoing.

Thanks & Best Regards
Harish Dobhal

P.S. Today I saw this thread surpassing Nifty All Time High (I mean the views) Congratulations friends. Now the nest target is Sensex all time high.

[vivek999]

Harish

I liked the way you have compared the number of views with Nifty All Time High...

All the Best for Sensex All Time High!!!

Regards,
Vivek

[hdobhal]

Hi vivek,

Thanks & sorry

sorry as I am replying so late...

Hope u will contribute to the sensex all time high

Harish

[kiran.jain]

thnks u all 4 the knowledge u all gave me.......

[hdobhal]

Hi Kiran,

I don't know how u managed to get that chart, but sincerely, I have this one. AND I have tried all my tricks to get the one like urs but failed...

See my chart and see what a shooting star has formed there, with the DOWNTREND LINE still being intact. I don't think its a Breakout yet...

Let's see...

[hdobhal]

Kiran,

I got one Idea!!! may be you are not using log chart

Harish