Today turned out to be a historic day of sorts.
After the clear cut verdict in favor or the UPA at the center, it was expected the markets would do well on open. But 2 circuit filters and trading being halted on the bourse was not expected by most.
A short synopsis of the days proceedings to quote moneycontrol.com.
Trading on both the BSE and the NSE has been halted for the day as markets hit a 20% upper circuit, after re-opening for trade. At the beginning of today's trade, 9:55 am, the markets were locked at 15% upper circuit and exchanges halted the trade for two hours.
The 30-share Sensex closed 2,110.79 points or 17.34% higher at 14,284.21 and the Nifty surged 651.50 points or 17.74%, to settle at 4,323.15. The Sensex saw the 14,000 mark and the Nifty surpassed the 4,300 level for the first time since September 22, 2008. The Nifty May futures ended with 46.85 points premium.
Now, the question to be asked. Is this rally for real or are the small investors getting into a trap.
Does a stock market rally predict an upturn in the economy? Has all the excess in the market played itself out?
I do not think so. But then as it is said the stock markets can be illogical longer than you can stay liquid.
It is still advisable for investors to be cautious.
From a trading perspective, our option trading helps us make money, even if our prognosis of the market trend turn wrong.
We tend to stay neutral on predicting the next course of the markets.
Our focus is on strategies that save our skin in the long run and when events such as today's happen we take hope a bonanza.
Yes, we did do pretty well today!
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