Thread by @sainik636

1. Select excerpts from the CH discussion yesterday attended by 600 + participants.

2. Factors to consider whether we are in a Bear Market or still in a Bull Market (i) Economic Indicators (ii) Corporate performance (iii) Stock/ Index Movement. (iv) Liquidity (v) Institutional/Retail positioning (vi)Geo Politics Activity (vii) Technical Analysis.

3.(i)Economic Indicators are mixed. While GDP, IIP, Inflation do not give confidence, only Tax collection esp GST is a Bright spot.(ii) Corp. performance has been "middling" with 1st signs of Inflation reflecting in the Margins of FMCG, Chemicals, Autos etc. Prices have reacted

4.(iii) While Main line Indices seemingly are just in a "correction mode" the broader market is clearly in a Bear Market (20 %+drop)( iv)FIIs have been relentless sellers since August'21. DIIs & Retail are carrying the can. Support seems to be fast slipping among Retail favorites

5.(v) Liquidity conditions are clearly tightening. FED is ending QE this month & has signalled a 25 bps increase in the next meeting. RBI ended it's QE in Nov. Markets are pricing in successive rate increases.

6.(vi) While the conflict in Ukraine is difficult to predict in terms of duration & extent, its increasingly becoming clear that sanctions on Russia will bite both ways. Russia is one of the top supplier of Oil/gas, Wheat, Corn, Coal, Steel, Fertilizers, Lumber etc.

7. (vii) Technical structure of market has deteriorated. Witness LH-LL, Volumes Low on rising prices, High on Falling prices, Erratic large moves (Rapid Distribution) & most important breach of 200 DMA. Nifty/BN/Midcap/Small Cap Indices have already done so.

8. Excepting Energy, Metal, IT PSU Bank & PSE which are above 200 DMA all others sectoral Indices such as FMCG, Auto, Infra, Pharma, Realty, Media etc are wallowing much below.

9. However sentiment in both MSM & SM seem to be bordering on complacency, especially among the Talking Heads, Influencers & Webinar Gurus. Some Uber Bulls looking at targets of 21k in the next couple of months.

10.Since 1992 there have been 11 Bear Markets.3 Bear Markets have seen a drop of 55 %+ while the rest have seen moves b/w 25 -40 % with median being around 30 %, & duration of 12-15 months .

11.Expect the Bear to last till end '22 with a bottom out at 14 K with first supports at 15 K(20 %) & if it breaks 14 K ,then 13 K (30 %). If it were to match the intensity of 2008 fall then 7500 would be the figure to dread. Brace for Impact. 😬

12. @Iamsamirarora @1shankarsharma @kapil_tandon @latha_venkatesh @andymukherjee70 @_prashantnair @GopikaGopa @dugalira

13. @threadreaderapp .Please "unroll"

14. If we consider 18600 as ATH & then going by definition of a Bear Market as a min. of 20 % drop then it should come to to 15K (last seen in Apr 2021);Drop of 25% takes it to 14K (Feb '21) ; 30% is 13K( Nov'20); 35% is 12K( Oct'20 ); 40 % is 11k(Sep '20) & 60 % is 7.5 K(Mar'20)

15.Mega Bear Markets: Apr '92- Mar'93(56%); Feb'00-Sep'01(55%); Jan'08 - Mar'09(60%)

Flash Crashes : May-Jun'06(31%); Jan-Mar'20(40%)

Regular Bear Markets : Sep' 94 - Jan '96 (40%); Jun96-Dec'96 ( 33%); Aug'97-Nov'98 (40%) Jan-May'04 (32%); Nov'10 - Dec'11(28%); Mar15 - Feb'16 (25 %)