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Market made new high Are we overdone?

From : Arpit Jain at 11:11 PM - Jul 14, 2010 ( )

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Market made new high.. Are we overdone?

As we discussed earlier market suggested some kind of breakout, it is almost done. 5200 to 5450..any thing more then tht may be overdone... i guess now analyst will come and say market will not fall below and start buying. but as i always tell you don’t go with them... may be some stocks do well. but am sure they will be handful only...yes possibility of going further to 5500 is possible but we have to ask question form our self then what? Is it just the range expansion or we are going much higher….

Time to be in the caution.... may be we will go not below 5300 but next 2 weeks are very critical there are so many head wins and backdrops...Technically markets are overbought and may be this is the reason for profit booking. clearly large capes given breakout of 10%-12% and mid cap also performed good.. now again time to take a nap for mid cap and large caps.. World wide markets are over bought so its very critical dow don’t go below it 10000 to 9900 it it break below .. we are no exceptions...

one advise don’t play contra trade again.. i guess market will not give much movement so option have to take some jerk.. and reduce the kind of premium they are trading ..so if market is stable and volatile or flat.. they all goda go down even if they are call or put so trade carefully...expiry will be 2 weeks away only.. better for safe player to move in to stocks instead of Options

Although we have some head wins as well fundamentally.. Earnings are robust.. July reports of monsoon are encouraging, substantial erosion of Debt form govt book, stability in inflation numbers.. some more disinvestment. And deregulation

But one more question on disinvestment n new offering..is so many companies are coming with IPO, for fund raising in next 2-3 months even govt wud be raising heavy cash form the market.. the question is do we have that much leverage and paper in the market.. what if money sucked form cash in tht and we will have tough times to move higher...this is my concern for rest  3-4 months.. am quite sure for next 3-4 months market will be very volatile and give you 10% moves later as well..

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