July 4, 2008
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NIFTY closes at 3925.75.

Investors, who are averse to risk avoid trading at least for 40 days. Technical analysis may not work well in this market. Markets are driven more by news than technical analysis.

Market is expected to bottom around 3550 to 3800 levels. If this level is broken, then we're in a bear market.

International crude prices or currencies would set a new trend in 2 trading days. They might set the next short to medium term trend. New trend would have an influence on the equity markets.

Unless US Fed announces its intention to raise interest rates, all world markets would be in doldrums. It is the only trigger that could reverse the rising crude prices in long term.

Long term investors could look into midcap Public sector banks which are available at very steep discount to book value. Most of them trade at 50% to 70% of the book value. So investments in such stocks would fetch 100% rate of rate of return in two years time frame. This is a pessimistic view. In optimistic scenario 100% rate of return could be expected within a year.