Prediction

 I am long the Nifty but will cut my long position and go short if Nifty futures breaks below 5263. After writing this, I want to write something interesting, something that people will feel like reading. I debated between commenting on some sport, some film or even on some random trader behavior but then struck on the idea of predicting the Nifty move this year. After all what can be more interesting than a prediction? Does not Bejan Daruwala sell more books than many Indian authors just with his annual Zodiac prediction? While many will never admit it, a lot of people do read the daily astrological prediction for their Zodiac in the newspapers.

So, I predict that the Nifty will touch 6000 in the first six months of this year. It is more likely to touch 6000 first than hit 5000. It is time to get out of defensive sectors like FMCG and Pharma and time to get into High Beta names. If I was slightly less lazy I would have actually bothered to find out some high beta names and talk about them in this note. But you are lucky that I am not that enthusiastic a person so this note will remain short! If this prediction, that is if Nifty hits 6000 then my next prediction is that the Nifty will hit 7000 before the end of 2013. By the grace of Ganesha, as Bejan Daruwala would say it, I will be proved correct on both counts.

Broking houses will start recruiting once again after Nifty crosses 6000. All those affected by this current downturn will get back to stable jobs. Fund houses will see a surge of investor interest. All cancelled SIPs will be rebooked albeit only after Nifty hits 6500 thereby proving once again that retail participation increases only at the fag end of a move. We Indians will start believing in our own myth of the Indian growth story and soon we will start believing that world revolves around India. We will start strutting around the global stage and when finally Nifty falls as it inevitably will, we will wonder why somebody in their right senses has to sell Indian stocks given our outstanding growth story. This will inevitably lead to conspiracy theories and the inevitable scapegoat "a poor short seller" will be found to be condemned.

In one swell note, I have managed to paint the picture of the next two to three years. Whether this helps you plan your investment decisions or not, I do hope this made for some interesting reading.