Monday, 27 May 2013

Market is very aggressive and buoyant - Written on 25th April 2012

As per my analysis & study there are four kinds of expectations in the Stock market. Those are as under.

Unexpected Un -expectation: We saw this situation in 2nd half of 2011 where negativity was at high. All bad news were at forefront. And people were expecting everything unexpected to happen in the matter of inflation, Interest rate, IIP data, Forex problems and Euro zone. Sentiment was so worse that people thought there were no tomorrow.

Expected Un- expectation: This is the scenario we are going through now. Where we know all the above problems still exist but they are known and will subside in due course. Though things have not improved and we know they are there but those things are in price as well. They do not expect any great things to happen soon.

Expected expectation: When these problems will really improve then Investors will get confidence in the market and they will start expecting positive results and positive return in the market. Their expectations in the market are reasonable. This is a very stable phase in the market and it lasts for longer term. People take wise decisions and their expectations are also met as it is easy to predict.

Unexpected Un- expectation: This situation comes again but at this stage Market is very aggressive and buoyant. People take decision from heart rather than Mind. And there expectations are unreasonable and unrealistic. And it leads to a burst of a bull cycle. Then panic emerges and people lose all hopes in the market, economy, Govt. and system, which is again a similar to No.1 kind of situation.

PS : Written on  25th April 2012

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