Traders' Chowk Dr. Priyanka Sharma is the founder of Traders’ Chowk, a research blog and stock markets focused education service provider. To know more, visit her Blog at http://traderschowk.wordpress.com/ Traders' Chowk on Facebook - http://tinyurl.com/ozvz8xh

Sensex loses 850 points- Is it really a bloodbath?

1 min read

Global concerns of Greek crisis, falling crude prices & weak global cues were the main drivers that drove Indian Indices into huge selling spree in yesterday’s session. The loss of 850 points from Sensex and 250 points from Nifty is one of the steepest one day fall in stock market history!

Although, such a sharp fall in just one session is not a very good sign for the forthcoming sessions; we must not compare this fall with the historical falls we have witnessed in Indian stock market during late 2007/2008-2011. Some of the greatest one session fall in Indian indices are summarized below:

Data Table

 
Most of falls were witnessed during 2008-2011, an era in stock market which can be fairly described as  bear market. Every fall then & there was more of a warning sign for new lows. In bear market, short  sellers rules the market as the overall sentiment remains highly negative which is surely not the case in Bull market, which is prevailing now. 2014 was the start of early bull market and we would assume the  fact that this bull market is not going to end so soon.

Sensex

Bull markets treat every fall differently, although some pressure might be seen in indices for few more sessions, steep fall which may lead to reversal of trend is something which is not anticipated at this point  of time. India, as a market is better poised (economically and politically also) and the fall which may  continue for few days is highly probable to find base at 7900-7920 levels which is the first support zone for bulls. Breaking of this support zone might only lead to loss of another 150-180 points in Nifty.

Traders must wait and find entry opportunities at the mentioned levels.

Cheers,
Traders’ Chowk

Traders' Chowk Dr. Priyanka Sharma is the founder of Traders’ Chowk, a research blog and stock markets focused education service provider. To know more, visit her Blog at http://traderschowk.wordpress.com/ Traders' Chowk on Facebook - http://tinyurl.com/ozvz8xh

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