Today there is a panic in markets world over and primarily it looks like hedge funds are selling due to redemption pressure. The pressure of selling intensified today in almost every market and is continuing as I write these lines. Yesterday I told about Nifty and Sensex breaking major support levels and today they are more than 10% down.
In this scenario when most of the indexes have retraced more than 62% of their past bull market up move, the question comes where is the next support? Well, for S&P 500 it is very near - 768, the low of 2002 can be a support going forward (As I write this, the S&P 500 Future is trading near 850). But looking at the sentiment globally, even that is doubtful. For Nifty of India, logically it is too far away - 920! It sounds crazy when I even think about that!!!
I hope things stop being worse, but then my hopes don't matter...
Hope, or rather false hope, was what killed the market, Harry.
ReplyDeleteyou are right jules,
ReplyDeleteyou know, its always illusion, when dow was at 14000 then it was an illusion of prosperity everywhere. Now its the illusion of doom. Which illusion becomes real is difficult to predict and that's the thing which makes trading possible.
what is real is that our society has become accustomed to relying on the very people who dug our grave to save our ass...
ReplyDeleteI totally embrace your free market theory now.
The market should be left alone.
Let bad companies fall. Let people who can't afford to buy a house rent. Let people who have been going on vocation on credit spend their summers visiting their neighbors and hold potluck parties instead.
yes, very true Jules
ReplyDelete