Money Tree

We have no clear signals for today, the markets have opened positive with huge volatility. The sentiment is still down at home and global markets are giving positive cues. Yesterday’s pull back was much awaited and expected, but now most of the analysts are holding a view that more pain is still left in the markets and they will be in the process of correction for a couple of months from now. The markets might test the lows of May 2006 and this correction may be more painful then the one we saw in May 2006.

Its best to watch the markets standing outside as it would be very risky to board a sinking ship untill we have a clear bullish trend. Still, one may ride the temporary volatility and swings but the investment horizon should be very short term with strict stop losses and with small profit targets.