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Friday, September 28, 2012

On market direction

I had posted a change in prediction in stock advice thread a week ago when reforms materialised. My purchase of gold almost soured - but I am still hopeful that gold will hold steady due to dollar price of gold increasing proportionate to Rupee appreciation. 

Short term obviously Rupee will appreciate. It might peak along with a top of the intermediate uptrend in stocks which should play till Feb 2013 at least.

I think stocks will outperform RE in next 6 months.

If reforms continue at this pace and keep coming - this will be a major bull market start. Rupee will stay sub 50 as long as reforms keep coming and stocks keep performing.

If reforms falter - Rupee will fall. So it is all in the hands of Chidu and MMS - and the announcements and achievements in next 6 months and then the details of next budget and the direct tax code details and the goods and services tax.

The last will not get BJP state govt cooperation - but rest if implemented - you need to be in stocks - and Rupee will be strong.

If govt falls - Rupee will fall and badly

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