Posted By : Kishore B.S
Today is the last day of the current year 2012, and with it the impact and the direction of the markets when seen during the course of the year has been splendid, infact it has been a year where the equity markets have outperformed the other asset classes where the Indices have inched up all the way from the 4900 levels during the same phase last year to the current levels of the 5900.
At this juncture it is important to note that though most of the Indices have performed well globally yet today is the important critical day to watch out for, since the US fiscal cliff hanging as the immediate hurdle to the rally could pose lot of challenges if not overcome by the 2/3rd of January at the max.
The technical charts are hinting at further rally and that is one hope for the bulls that this hurdle of US fiscal cliff might be overcome in favour of the bulls to charge ahead to the 6000+ levels which we have been eagerly looking out for.
However markets have their own way of confirming the future direction and it would in the best interest now, to watch what that would be…. on this note I recall having stated on the blog on Friday that if the closure of Friday is above the 5910-18 levels then the bulls would be in control and to my dismay the indices ended on the brink of this levels but failed to give a confirmed signal and hence the dilemma.
With this dilemma in mind I would reiterate again that if the indices should close above the 5918-22 levels for 2 consecutive days for the uptrend to be confirmed and close below the 5840 levels for the downward trend. And till then it would be advisable to exercise caution and take positions with swing opportunities only ……