23.06.2016 –
Nifty - 8264
Brexit or no Brexit
I found it prudent to enter into
Brexit event with zero position. However I have been trying to find out a
strategy for Brexit since Monday. More I thought about it and tried to take some views from people in London but I
felt everyone is confused about the outcome. I was very much sure that the
Britain will not move out of Eurozone but as people on the ground will be
voting I got little concerned that there is a possibility of Brexit.
As far as markets are concerned
Brexit thing has been going on since last three weeks and markets have been
holding high and it seems Brexit is not factored in. In fact Europe has been
rising since last three days. More or less everyone is certain about the
Britain staying in the Europe. My assessment was also that this will be non
event as far as Indian Markets are concerned.
Indian markets have held on to
8200 levels quiet well. In fact 8080 zone has worked as super support for
markets. Markets according to me are in super higher top higher bottom
structure and we are in a structural bull rally. I feel very high levels are
coming into Indian equity markets and any sharp fall will be used by
Institutional investors to lap up the market. I feel we are certainly cheap
till we reach previous peak and time correction of two years will already have
happened if we reach to previous peak by January 2017.
I am expecting a fall of 4 to 5%
in markets in next 20 -25 days from hereon, but within this period lot of
certainty will prevail over the monsoon which according to me a sole factor
which will trigger lot of positive news right from interest rate cut to
earnings improvement.
Nevertheless this Brexit event
according to me will be a buying opportunity. I feel whether Brexit happens or
not the Rajan effect will be there. On Monday post Rajan Exit FIIs sold Rs 500
crores but DIIs came into action and bought a big chunk of Rs 750 crores. I
feel the Rajan effect will be there its just that it wont be called Rajan effect
much to the liking of the government.
The Monsoon seems to be advancing
as desired and will give better imact I guess.
Brexit or No Brexit we are in for
a good rally I feel. But wait for a correction most prudent for traders.
