Are you ready for another May crash?

Media and Analysts are already started commenting about new highs and bullish trend. I don’t buy into their views. I am suspecting another “May Crash” in the coming days due to unreasonable valuations. Investors should stay away from markets in these volatile times while traders and operators continue to play their games.

Strategy: Closely watch Rupee value, Metal prices, Crude price and Inflation rate. Rupee appreciation is enough to crash the markets. Foreign investors may book profits at any time.

My thoughts on the Indian share markets:

1. Stock markets rose in the recent sessions without any significant positive news. More hype behind this rise than substance.

2. Investors are just following herd mentality. They bought IT stocks yesterday (even though rupee is appreciating). This is a dangerous sign. There will be heavy panic selling on negative news. E.g., Bajaj Auto yesterday.

3. Can SBI, SAIL, TV 18, JSW Steel and Reliance Industries justify their valuations in the next 2 quarters?

4. Except Reliance Capital, other high rising stocks may fall by more than 10% in this month.

5. Why Banking index rose on March 16 and fell on March 17?

6. Why sugar stocks are rising intermittently even though sugar prices are at all time low?

7. Why Real-Estate stocks are suddenly rising?

Use your common sense before investing in stock markets. In my opinion, markets will soon touch 12,000-12,500 mark.

About Teledata:

Yesterday, one reader asked me about the prospects of Teledata.

My opinion: Teledata rose too much within a short span of time. Not even a single mutual fund is holding this stock. It means markets have still suspicion about its future. It is a pure traders stock. Short term Investors with high risk appetite can enter into this stock at this level.

Market Trend:

Investors will book profits today and yesterday’s top gainers will suffer heavy losses today. Rupee appreciation and crude price rise will spoil the sentiment of the markets. All the global markets are trading negatively due to fall in metal prices and rise in crude price.

Positive News of the day:

1. The government has decided to allow states to acquire land for SEZ projects on behalf of private developers as long as owners sell their land voluntarily.

It is better for investors and traders to stay away from the stock markets today.