- 7600 is Nifty’s multiyear base from where we have been rebounded many times in past 6 years, even this time also we have been rebounded from that same level which shows a good sign and confidence in this market.
- VIX India (Volatility Index) made high of 86.64 and came down 25% to 65.63 which is sign we have already made bottom and gives peace to bulls and it will give confidence to create long positions.
- FII selling has been reducing since last week and till yesterday figures has been reduced to 435 crore from 4 digit figures and now they have started adding Index futures and options. And as soon as FIIs will start buying then market will zoom out like anything.
FIIs Net Flows in Cash Selling Reducing
March 18 5085 Crore
March 19 4623 Crore
March 20 3346 Crore
March 23 2989 Crore
March 24 2153 Crore
March 25 1893 Crore
March 26 435 Crore
FIIs Longs in Index Futures
Feb 28 12%
March 6 18%
March 13 22%
March 19 34%
March 23 42%
March 25 53%
4. Many Investors are relating these crises with 2008 crises, but there is huge difference between both the crises. As 2008 crises was liquidity crises which can’t be resolved within short time span but this time it is due to Covid-19 which can be solved over period of few months. In 2008 market went down more than 50% over period of 5-7 months and recovery came in 2009 but in 2020 we have been corrected more than 40% in just period of a month so market may get recovered within a period of 2-3 months.
5.We will not find big profit booking at this levels, Reason as follows:
• Retail Investors are not extremely leveraged so they will not sell at this levels
• HNI just bought so they will wait for further rally
• SEBI put margin restrictions so FIIs, so FII’s will avoid short sells at this levels.
Markets are oversold so we have given buy call to our clients at Nifty 8260 with short term target of 8640/9032/9645/10800. We are bullish in market at these valuations as valuations are very cheap and this Covid-19 pandemic will get resolved within a period of a month in India as we are expecting vaccine or drug very soon.
So we are recommending buying some quality stocks at attractive prices. This stocks can outperform and lead the recovery rally. We have designed this portfolio with appropriate weightage and investor can buy in same weightage according to their investment.
FOR INVESTORS THIS IS BUYING OPPORTUNITY ACCOUMLATE QUALITY STOCKS ON EVERY DIP, AS THIS VOLATILITY IS BECAUSE OF MAJOR EVENT BUT FUNDAMENTALS ARE VERY MUCH INTACT. VOLATILITY IS FRIEND OF INVESTOR.