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Working for India of 2024 - An Open Letter to PM# Most Respected Honourable Prime Minister,Sweeping victory for BJP in 2019 Lok Sabha Elections!! Many many congratulations to all Indians living here and abroad!!We Indians are congratulating ourselves for our electoral victory in 2019 parliamentary elections. More than BJP, we consider it as our personal victory. We are overwhelmed with a sense of pure joy and happiness. We have been witness to this historic victory as stake holders. For millions of us, this auspicious day will stay in our memory as a daydream till our last breath. And you are the architect-in-chief for making this dream come true. We are utterly grateful to you for allowing us the pleasure of witnessing this historic day.I know I will be branded as Modi Bhakt by our left leaning liberal friends and intelligentsia, who are well educated from elite institutions but use their education and intellect to pander to forces inimical to our national interest, culture and pride. As an average Indian I no longer care. On the contrary I will take this epithet of Modi Bhakt as a Badge of Honour, because then I will see myself as an ardent follower of the greatest nationalist, unifier, visionary, nation-builder and statesman of independent India. I know millions of Indians will echo these very sentiments.However, the purpose of this open letter is not what has been summarized thus far. Intention is to bring to attention major national issues which an average Indian would like you to fast track and bring to fruition in next five years of your tenure as PM. These issues assume more relevance if India has to become a 5-trillion-dollar economy by 2024. These urgent issues are outlined as under:-Uprooting Terror Infrastructure from South Asia.We understand that terror is a very profitable industry for many powerful entities like global corporations, business houses and some nations. Terrorist activities are aimed at breaking up a nation and its resolve of maintaining sovereignty. This is multi-trillion dollar business for global corporations, which inter alia includes profiting from nations' war efforts through Arms' Sales, nations' massive reconstruction efforts after devastation from war, and claiming ownership of a weakened nations' natural resources. Hence we find various entities with seemingly divergent ideologies gang up to work towards the common purpose of terror. Most common example is that of communists (believing in no religion) giving support to Jihadis (extreme religious fundamentalists). Its money that makes the mare go!In order to become a 5 trillion dollar economy from 2.7 trillion dollar present economy, we will need enormous foreign investment in India. For that we need to quickly dismantle the terror infrastructure and ecosystem in South Asia so that investors feel safe to invest heavily here. The following should be the focal points of our action:-Destroy Ecosystem of Mughalistan. Concept of Mughalistan has been formalized by Pakistan through Mughalistan Research Institute in Bangladesh, funded jointly by ISI and DGFI (Director General Forces Intelligence, Bangladesh). Map released show that Pakistan and Bangladesh are planned to be connected through a corridor comprising J&K, Mewat, UP, Bihar, West Bengal and Assam. All Jihadi organisations, including Al Qaeda, LeT, JeM etc have given support for the creation of Mughalistan. If we have to prevent second partition of India, we need to act fast to destroy terror infrastructure in Pakistan and Eastern beach-head in Bangladesh. We need to start cleansing process from West Bengal which is fast becoming part of the Eastern beach-head. Today this is far bigger danger and challenge than Naxal Movement.Identify and Neutralize Pak Deep State. Terror activities in South Asia are planned, funded and propagated by Pakistan deep state.We need to identify and target our efforts to decimate this machinery in totality. Global and regional cooperation in this endeavour should also be sought.Neutralize Naxal Movement. Districts under naxal influence should be freed and brought fully under Indian administrative control. For that the overground naxals who give ideological and administrative support, fund and arm the underground combat naxals have to be rounded up without any compunction. They are the actual perpetrators of terrorism and their extinction will automatically asphyxiate the naxal movement without a bullet being fired.Fast Track Infrastructure for Full Utilization of Indus water TreatyIn 1960 we had entered into a lopsided Indus Water Treaty which is discriminatory to Indian interests. Be that as it may, now we need to urgently put in place such infrastructure which will help us to fully utilize water resources to the extent provisioned under the said treaty. This should get Top-Priority in infrastructure development to help our farmers in J&K, Punjab, Haryana and Delhi region.Championing Cause to Free BaluchistanActive international diplomacy should be undertaken to help Baluch attain independence.. World bodies like UN have to realize that there had been forced occupation of a free country called Baluchistan by Pak Army. Before the partition of Undivided India, Baluchistan was an independent country. That means Baluchistan was not part of Undivided India. After partition of Undivided India, Pakistan came into existence. Then how can Baluchistan be part of Pakistan!! Forced occupation of independent Baluchistan by Pak forces has escaped the attention of world opinion, media and regulatory bodies for past 70 years. This needs to be urgently corrected, and it is our moral obligation to bring this issue to international focus with all diplomatic might at our command. In this venture we can enlist the support of US and China. US should be happy with a free Baluchistan giving terror free access to Afghanistan. China should be made to realize that their Gwadar Port development will be best served in an independent Baluchistan - free from double crossing, blackmailing and terror tactics of Pakistan.Internationalize Kashmir Issue Kashmir became integral part of India from the moment Instrument of Accession was signed by Maharaja of Kashmir. This irreversible process was followed as Rule of Partition by other princely states who became part of India. We should seek for vacation of our occupied territory with help of UN, if necessary.Abolish Article 370 and 35A Article 370 & 35A is discriminatory to the population of J&K. They have right to equal opportunity as rest of India. It is dishonesty to say that J&K is an integral part of India if we are unable to provide full benefits of growing India to Kashmiris due to restrictions imposed by these dubious Articles.Removal of Illegal Immigrants from IndiaIllegal immigrants pose both internal and external security threat. This is a non debatable point. If that is the case then we must address this important issue with all seriousness and sincerity so as to make India a safer place to live and do business. International community, especially US, would also support us in removing illegal immigrants from our soil. In any case, whatever is illegal cannot be tolerated at state level dispensation. That would tantamount to making mockery of Law of the Land.Proactive Steps to Make India a Manufacturing HubUS-China trade war has thrown up a favourable situation for India to position itself as a prospective Manufacturing Hub in this region. 40 US companies have already exhibited their willingness to relocate to India. Sincere efforts should be made to attract more of these US companies to India by rolling out the proverbial red carpet. This will help generate employment and promote exports, thereby greatly boosting the economyDebar Communists from Electoral ProcessCommunists believe that "Political power grows from the barrel of a Gun" Political parties which believe in this philosophy of terror should not be constitutionally allowed space in a democratic electoral process. In a democracy, accommodating divergent ideologies does not mean that an ideology which abhors democracy should also be allowed to participate in electoral process. It is akin to giving political space to sworn naxals and jihadis.When we allow communists to take part in electoral process, we are basically allowing them opportunity to seize power democratically in some weak moment of our nation in future. Once in power, will the communists allow democratic institutions to function or turn the country into a communist regime? Aren't we being selfish when we are leaving scope for our future generations to be doomed to live under a communist regime after having ourselves enjoyed all the fruits of democracy?This issue begs a national debate. Debarring communists does not mean excluding socialist ideology, which is perfectly compatible in a democratic country. If a communist party believes in democracy then why would it call itself communist? And if its stated ideology is communism then why is it taking part in a democratic process? Answer is simple - to usurp power and turn this land into a communist country. Very frightening thought!Anti Conversion ActMass religious conversions are an internal and external threat to our nation. These conversions have the power of causing internal strife in our society and can also be the cause for demand of secession from India. Hence it is of utmost importance that we pass an Anti Conversion Bill in Parliament at the earliest. Those opposing this Bill may contend that this Bill is not necessary as no mass conversion takes place in India. If that is the case then they shouldn't be worried because the law will never be invoked. It will only act as a precautionary measure.Correcting our Historical and Cultural HeritageStrength of a nation lies in its cultural and historical pride. But if these facts are distorted by occupation forces over centuries, then that nation forever remains a weak and slavish nation. Our nation has been through this very situation and has not been unshackled so far. We need to employ the best experts to correct this anomaly without any guilt and shame.Conclusion. I may have been inaccurate and off the mark in elucidating some points. However those points may be ignored and work in remaining points may please be undertaken with full gusto. If all points mentioned herein are of no consequence, I may please be excused for being naive.Sincerely Yours,Surajit DebnathJai Hind!
US Equity Markets on Roll - How Long Before A Thud?# Keep your ears to the ground. This meteoric rise of US equity markets is unsustainable. It is bound to fall like a ton of bricks. Reason - the rise has been without proper foundation. It is as if some deep pocketed cartel has decided to off load its portfolio in equities and switch to some other market . To start doing that, the prices have been jacked up so that more investors join the band wagon, believing that bull market is intact, alive and kicking. That is far from the truth.To understand what is happening in market, you will have to refer back to my last Sunday blog post here What's in Store for US Markets in 2019 ?In my forecast for the month of January 2019, I had envisaged Dow going above 24000 level. But not in such a fast and furious fashion!! I had also mentioned that Dow will reach 25000 by end January or February. But it seems that this market is in a tearing hurry to reach 25000.What is causing concern to me is that the present rise is with low trading volume. That is typical of times when big players haul up prices as a part of process of distribution.In any case we have the complete course chart of Dow for 2019. Keep referring to it when in doubt. I will keep you posted of the developments. Traders should not think of buying at this point. For selling, let the current up-leg top out first, which I shall indicate in advance.Remember it is still a bear market and 23000 in Dow can be easily achieved in coming days. So trade with adequate caution against upcoming volatility.
Nifty Follows A Scripted Path - Comforting Situation# In the wee hours of last Monday, I had scripted a chart for Nifty for the complete year 2019 in my last blog post. Idea was to test my understanding of the behavior of Indian equity market going forward. By doing so we will be able to gauge whether this understanding stands the test of time. At any juncture if we find Nifty deviating from the charted course, it will serve as an alarm bell and we can then carry out mid course correction.So far in this week Nifty has done exactly as scripted. I had opined that Nifty will be range bound between 10500 and 11000. You can revisit my last blog post here Indian Equity Market View For Year 2019In today's trading sessions, Nifty had reached level of 10930. If my script has to play out, tomorrow Nifty should be travelling southwards. Permabulls may please take note of this and try to be careful in tomorrow's trading session. Do not get carried away by the strong Nifty recovery in today's late afternoon trade from 10845 to 10930 level. Nifty finally closed today at 10905.Why should Nifty fall tomorrow? It could be for myriads of reasons like Brexit woes, China slowing or market participants getting weighed down by domestic political risks. When the actual destabilizing news finally percolates down to retail investors, action would have already taken place in market. We will only be scrambling for cover. That is where my scripted chart will help you to be cautious. Keep referring to it for future guidance.As per the strong form of Efficient Market Hypothesis, market is totally efficient with market prices quickly adjusting to reflect all types of information, both public and private(inside) information. This basically means that both technical and fundamental analysis of stock market is useless and investing/trading in such market is like throwing darts (random walk theory). With my script on Nifty's future path for the year 2019, I wish to debunk this theory.Feedspot List For Global Top 100 Stock BlogsWith your blessings, I take the liberty to announce that this blog has been featured in global list of Top 100 Stock Blogs by Feedspot. It has given me immense pleasure and satisfaction and has filled me with dollops of josh to continue writing for you. I am truly humbled with this astounding honor.
Indian Equity Market View For Year 2019# Nifty index is the bellwether for Indian stock markets. Tracking Nifty will essentially give us insight into expected behavior of Indian equities. It is the beginning of year and hence is good time to track Nifty.Nifty is presently in sideways move, displaying very low volatility. It is expected to remain within the range of 10500 to 11000 for the next couple of months. That is primarily due to the upcoming General Elections and market participants are in no mood to fully commit themselves either way.What Happens After MarchAfter March things will crystallize to a large extent as to whether present incumbent NDA has the upper hand in the upcoming elections or not. Let us analyze the two outcomes :- NDA Has Upper Hand : In that case you will see Nifty drift down to 10300 level. That will be for accumulation purposes for big market players. In other words, if you find Nifty at 10300 level in April, you may safely assume that NDA is going to win the elections, since the big boys of the market think so. Hence you should also accumulate stocks if you find Nifty at 10300 level in April.NDA Does Not Have Upper Hand : In such a scenario you will find Nifty racing to 11200 level on low volumes. This means that movers and shakers of markets are expecting NDA to lose the elections and hence are carrying out the process of distribution of stocks. Hence you should also sell major part of your portfolio if you find Nifty at 11200 level at the beginning of April.What Happens after the ElectionsIn case NDA wins the elections you can expect Nifty to make new highs beyond its all time high of 11760. But in case NDA loses then it is going to be be one hell of a slide down into a bottomless pit. I would not be surprised if we see 7000 level in Nifty if NDA loses the upcoming General Elections.Your ViewsDo express your views on the subject in the Comments Section. With your views we may be able to understand this beast named equity markets better!!In case you have any queries, do post them here and I shall be happy to get back to you. Watch this space for I shall be updating you at appropriate moments as Nifty makes its moves going forward.Happy trading and investing!
What's in Store for US Markets in 2019 ?# Last week Dow Jones Industrial Average (DJIA) closed just shy of 24000. This gave Dow an impressive 2.6% gain from the start of the year 2019.What next is the million-dollar question that begs an answer? I am going to provide some insights which should answer this question.Forecast for Next WeekCome Monday, DJIA should see a steep drop. It will be due to the patience of the market participants running out over Federal Shutdown. Thereafter there will be volatility for the week with DJIA visiting levels above 24000 and below 23000.Forecast for Month of JanuaryThe month of January will present a good opportunity for traders to profit from going long from sub-23000 level. From this level, there is an excellent chance of profiting until the level of 25000. This may not be achieved fully in January, but certainly, by February we can see 25000 in Dow.Forecast For First Half 2019The first half of 2019 will be spent in volatility with Dow between levels of 23000 and 25000. I would expect the bias in this yo-yo journey to be southwards, but this can be said with certainty as the action unfolds. I am basically saying that Dow will be moving sideways for the first half of 2019 between the levels of 23000 and 25000. However, jubilant reactions to some unexpected good news may allow Dow to reach levels of 26000.Forecast For Second Half 2019The second half of 2019 will see either continuation of sideways movement with southwards bias or an effort to reclaim the level of 27000. High probability is the former case of slow Southward Drift so as to be positioned for a good sell-off by 2020 -2021.Here the reason lies in the inversion of US Treasuries' Yield Curve of 2-year and 5-year maturities. Now market participants will be keenly watching the yield curve of 2 yr and 10 yr maturities which is presently flat with narrow yield difference of 17 basis points. This hints that the yield curve of these papers has a high probability to invert anytime in future.Early Signals if Dow Movements were to Differ From Above ForecastsLet us now list the various early signs that will tell us that Dow will behave differently from what I am predicting:--If Dow fails to reach 25000 levels and violates 22000 levels on a closing basis, then we will see much lower levels in 2019.Alternatively, if Dow crosses above 27000 levels on a closing basis, then new highs will be made.If the sideways movement takes place between levels of 22000 and 24000, then we will find Dow at lower levels than 22000 in 2019.Seeking ViewsI have charted the entire Dow movement for 2019. Anyone wishing to seek the detailed reasons for each of these forecasts is most welcome to do so in Comments Section and I shall be delighted to provide the reasons.I shall also be updating you on weekly movements as and when appropriate. Your views will be highly appreciated by me and other readers. Your views may provide some new insights from which all of us may benefit.Keep trading in 2019 with profit!
Trump's Era - Why Is He Not Your President?# First we witnessed widespread and sometimes violent protests saying "Trump is not my President". Then there were protests to allow "Illegal Immigration" to carry on unchecked in US. Close on its heel came protests against "Travel Ban" from seven countries to US.Then Michael Flynn had to resign from post of National Security Adviser due to leak that he had spoken to a Russian diplomat, Sergey Kislyak.Now pressure is being applied for resignation of Attorney General Jeff Sessions for having spoken to the same Russian diplomat.Phew! that's quite some action for Trump-bashers to orchestrate in such a short span of time. But you already have inside information on Illegal Immigration and Travel Ban through my postTrump's Era - Acts to Save Democracy For Future GenerationsAs for conversing with Russians, you have the low down in my last postTrump's Era : Target Real Enemy States, Not RussiaNow let us understand the logic behind screams of "Trump is not my President" in US and other world capitals. And that is exactly what we are going to do today. To begin with, let us ask some straight questions to these protesters. And if they cannot answer these questions honestly, then they should eschew their unreasonable demand for Trump to step down. Here we go :-If a democratically elected leader is not your President, then who do you think should be your President - Army Chief, CIA Chief , Fed Chief or some Chieftain of your tribe? What twisted undemocratic logic, coming from those who plan to save US !! Will someone please tell them that US is the world's oldest democracy, and such wishes have no place in a democratic setup.Why were the protests happening even while Trump was taking oath of office? At that point in time, Trump had not signed any executive order or trampled any democratic value or violated any constitutional law. Then why, why, why? That reeks of well orchestrated plan set in motion by some shadow power. We may dwell on that at some later date.Do the protesters want Hillary Clinton, who lost the election to Trump, to be officially declared the President? In that case they have to first make amendment to Constitution to read thus " US Government will henceforth be of the protesters, by the protesters, for the protesters. Silent majority will have to remain passive spectators"Think it over. This thinking exercise is meant both for the protesters and silent majority. After all it is your country and you have to decide whether you want to continue breathing in a democratic setup or in a messy anarchic cauldron that the protesters are seeking.Protest as much as you like, democracy allows for that. But at least protest with some democratic rationale. You cannot protest for removal of a democratically elected leader, just because silent majority endorses him and you do not. Time to wake up and spread the word!
Trump's Era : Target Real Enemy States, Not Russia# What is this hullabaloo about US official talking to Russian counterpart? What on earth is wrong in engaging with Russia? Is Russia an enemy state which is trying to wage war with US? Has Russia made any attempt to invade US through conventional or proxy war? If not, then how is Russia perceived to be an enemy state for US wherein Russians are considered anathemas?Let us analyze in detail the questions that have arisen here. But before that let's draw your attention to my last blog-post which analyzed the controversial decision of President Trump on Illegal Immigration and Travel Ban . You may like to dig out facts here in Trump's Era - Acts to Save Democracy For Future GenerationsRussian Untouchability President Trump has rightfully declared that he wants to establish cordial relations with Russia. It takes courage as a US politician to go against long held popular bias and negative sentiments about Russia. Surely such intentions cannot be construed as a populist move!It is high time to bust this myth about Russia being an enemy state to US. Consider the following myth busting facts and then form your own opinion :-Russia is not USSR and we are not in Cold War Era. Today Russia is as much concerned about maintaining peace and harmony in the world as any other right minded democratic country. It has shown remarkable commitment to fight terror with commendable success.On the contrary, NATO is Cold War Era outfit which needs urgent overhaul to meet the challenges of present day geo-political realities. It should throw out member countries with proven record of links with terrorist organizations. Time and again Russia has given enough proof to world, for NATO to act against its terror-linked member countries. But nobody cares! Now tell me, who is acting against world peace - Russia or Arms Lobby controlled NATO ?Russia is just another democratic country, maybe with an extra dose of national pride and identity. But what is wrong with that? Open ended left liberal Democracy needs to evolve with time into something more meaningful that caters for national interest also. That is the only way forward for Democracy to survive. If not, we will soon find present democratic countries hurtling towards becoming chaotic regimes like those in Middle East and most of Africa.Russia Vs Saudi ArabiaWhat is so democratic about Saudi Arabia that US loves? In the same vein, what is so undemocratic about Russia that US avoids like plague? Glance through the following revelations and decide for yourself :-Both Saudi Arabia and Russia are separated from US by Atlantic Ocean and hence pose no geographical boundary threat. However, by propagating and funding Wahabi/Salafi ideology, Saudi Arabia has helped create many terrorist organizations/regimes. Wahabi/Salafi ideology is the most radical form of Islam known to mankind. By that yardstick Saudi Arabia should be anathema to US, but is its closest ally in Middle East. Russia has no such radical proclivity and yet is perceived as enemy state. Don't you find that hypocritical?Russian and US scientists cooperate in many technological fields to make life on earth better for mankind. On the other hand, Saudi interaction with US has always been to find ways to expand its regional power through blackmail or machinations of Machiavellian dimensions.Russia helps regimes in their fight against ISIS, as does US. On the other hand, Saudi Arabia provides clandestine financial, material and moral support to ISIS while condemning them with forked tongue.Do you still want to fault President Trump for trying to initiate better relations with Russia? President Trump is trying to align democratic forces, without any bias. He does not carry any baggage of past hostilities and is genuinely trying to make America Great again. But that upsets very powerful vested interest groups who had earlier managed to corrupt previous US administrations, and we all know that. Ever wondered how ISIS and Clinton Foundation are both funded by Saudi regime? More on that some other time.If you think differently from what has been said in preceding paragraphs, do pen down your thoughts in 'Comments' section and we shall discuss your point of view in the next blog-post. But if you agree, then do lend your support wholeheartedly to President Trump's efforts to make US safe, secure and Great again. That will help European nations to wake up and smell the coffee, thereby helping democracy survive. We owe at least that to our future generations!.
Trump's Era - Acts to Save Democracy For Future Generations# Trump policies and beliefs are being criticized and condemned through the length and breadth of US and the world. Protests continue till date and seems to be increasing by the day. Before you get swayed by the protests, ask yourself the following questions: Why should anyone object to plans to stop illegal immigration from southern borders of US?Why create furore over travel ban on seven countries, viz Libya, Syria, Iran, Iraq, Sudan, Yemen & Somalia?Illegal Immigration Anything illegal should be immediately stopped. That is the Rule of Law- bedrock of any democracy. If President Trump is trying to stop illegal immigration, why should there be such massive resistance from US citizens? Are you in favor of illegal activities?Here President Trump is brave enough to risk his political career in order to uphold democratic values in the oldest democracy of the world. You are invited to give your opinion on following views :-There will always be vested interest groups to protest against Trump's plans to stop illegal immigration from Mexico. Please remember that Illegal Immigration is big business involving numerous agencies and mega bucks.Illegal migrants fall easy prey to criminals. When they cannot find legal work, criminal organizations like drug mafia step in and provide work to these illegal migrants. Why should you allow conditions wherein criminal activities get boost in US?Do not get swayed by what Press says. Get to the bottom of any policy. Is it advantageous to your safety and security or not? President Trump has taken a historic and bold decision to stop illegal immigration into US, unmindful of his own popularity and world opinion. Very few politicians on planet earth can exhibit such courage!As for Press and world opinion, please discount them since they form part of interest group. If illegal immigration is such a virtue then seek answer to following :-Why did Italy sign numerous accords with Gaddafi's Libya to stop illegal migrants to reach Italy's shores? Even after realizing that Gaddafi's regime was committing horrendous human rights violations to the returned migrants, Italy still carried on returning illegal migrants to Libya and kept filling the coffers of Gaddafi with compensation. Where was free Press and world opinion then?Why couldn't Australia accept illegal migrants into their society? These migrants were just a handful, and yet Australian PM went ahead and convinced Obama to accept them into US society. In Australia these illegal migrants were isolated and kept in inhuman conditions in offshore islands. No free Press or world capital erupted in indignant protests.Why did UK embrace Brexit, which was primarily against open door immigration policy of EU? Can they now turn around and organize massive protests on the streets of London on issue of illegal migration from Mexico.Why did EU enter into deal with Turkey to absorb illegal migrants in lieu of money? Where is free press and world opinion on such double standards?Do understand that every nation has to look after its own safety and security. President Trump is doing just that for US and has the courage to stick his neck out against overwhelming world opinion and hostile press.As for negative Press, please realize that mainstream Media is owned and controlled by big corporations and conglomerates. They have myriad economic and vested interests globally. You need to take their opinion with a pinch of salt and decide on issues based on national interest.Travel BanPresident Trump has issued an executive order to temporarily ban travel from seven countries, subject to review after 90 days. Iran,Iraq, Sudan,Somalia,Syria, Libya & Yemen figure in this list of temporary travel ban. Looking at this list, can you put hand on your heart and say that this executive order is against national interest? You are invited to express your opinion to following views :-Is US dumping ground for world migrants? If world opinion is so sharp on travel ban by President Trump, why hasn't any country come forward to accept these migrants? On the contrary EU agrees to pay 6bn Euros to Turkey to stop migrants from Arab countries entering EU.Why migrants from these seven countries are insisting on crossing the Atlantic and landing on US soil? Closer home, they can seek refuge in affluent nations like Qatar(highest per capita income in world), Brunei(5th highest per capita income), Kuwait(6th highest per capita income), UAE(9th highest per capita income), Saudi Arabia(10th highest per capita income) and other oil rich gulf countries like Bahrain etc. US is just 14th on this list of per capita income of countries and yet there is such a do or die situation being painted for their temporary ban to US. US and other western democratic societies have evolved painstakingly over the decades with certain value system which is inherent and intrinsic to their behavioral pattern. These societal mores and customs have now become ingrained in their outlook to life and way of living, conforming to democratic values.President Trump is simply trying to preserve these Western democratic societal values by imposing this travel ban. Consider the following thoughts, which are factual and are in no way a judgement on any societal values being right or wrong :-Migrants from these seven countries have a different value system ingrained in them over centuries. Democracy is not part of their way of life. Recently some had violently brought about regime change in the name of democracy but still failed to install democratic governments. Do you want these values to get imported to US society?Democracy does not mean only democratic rights without responsibilities. First responsibility in democracy is maintaining sovereignty and integrity of your nation. Nation state does not mean that there will be only one sect, or religion or ethnic group. People from these seven countries have been brought up to believe to fight for rights of only one community, with scant respect for anyone else. Their generations have struggled over years to bring down regimes primarily on sectarian lines. Do you want to be swamped by such value system in US society?Religion is basically a matter of faith between an individual and God. Religious places are meant to cater for facilitating this union between man and God. But religious places in Islam are fully integrated with politics of that country and remain in forefront of political discourse on daily basis. Are you ready to accept religion to interfere in US politics in times to come?President Trump is taking all steps to save democracy in the last and oldest bastion of true democracy. European nations will wake up to do the same at some later date.You may have different views on all that has been said above. Do give your valued comments with facts and reasoning. There maybe many aspects that I have overlooked. Do shed light on missed aspects and I will feature them in my next blogpost with your credits.Do seek comments from your friends and family also, and let me know differing views or more details on the subject for better understanding of a complex issue.
Dow Reaches Milestone 20000# It was tantalizing moment when Dow Jones touched historic milestone of 20000 on Friday 06 Jan 2017. It was a moment to celebrate, specially for me. Way back in Oct 2014 I had predicted this milestone in Dow while commenting in a MarketWatch column. Dow was then at 16400 level.My comment had elicited a response from a reader and I decided to start this blog to track Dow's journey to projected 20000. To get the drift, check out my first blog post Dance of Dow. You can also access the above referred MarketWatch column here. My comments can be viewed in the Comments sectionOut of my four predictions on movement of Dow, three have so far come true. My fourth and last prediction is the most frightening. It is Dow's fall to 10000 from level of 20000.What possibly can be reason for such a cataclysmic fall to 10000? You may find an answer to this in my earlier blog post Bears Sharpening Daggers - US Markets in Danger of Bear GripCrude and Brexit have already done their bit in shaking the markets. China still remains the elephant in the room.
Bored of Being Unemployed - For Traders Only, Investors Keep Out# As of this moment Dow is trading at 17716, down114 points. Traders be ready to jump into trade as discussed below.What we are going to discuss today is for traders' eyes only. Investors please do not try this risky strategy that I am going to discuss today. One has to be nimble footed and there is no room for fat fingers.I will be giving Dow levels to trade. Scrips which are co-related with Dow movement can also be traded, keeping given Dow levels in view. I hope I am clear. If yes, let's trade ;-Condition # 1If Dow falls down to 17400/17450, then buy.Sell your position when Dow bounces back to 17850/17900To square off this trade should not take more than a week.If this trade materializes then you stand to gain 400/500 Dow points in quick time.Condition # 2If Dow does not breach today's low of 17700, then wait for right conditions for sell to develop.Dow is going to trade sideways, so sell will come if Dow takes bounce from 17700.I will let you know in advance when sell conditions develop.By now you must be aware that I had predicted these volatile trade conditions on 15 Apr 2016, when I had recommended exiting long positions in Dow. For those who are visiting this page for the first time, you may like to read that post titled Bears Sharpening Daggers -US Markets in Danger of Bear GripFurther I had mentioned in this post that 18000/18200 is selling zone in Dow and bears would like to ferociously defend this last known territory. In that post, I have also discussed about my apprehension of "Bull Trap", which seems to be turning out correct.Today I am giving out this trade, mentioned in Condition # 1 above, only for traders. From 15 April 2016 onward we have been unemployed as mentioned in my earlier post Out of Work But Thankfully Out of Danger - US Markets Dive. I am reminded of the cliche "Better safe than sorry".
Japan Unsettles Global Markets - Havoc Spreads# Bank of Japan announced it's monetary policy today - that announcement brought tsunami in local and global markets. What did Bank of Japan(BoJ) do to unsettle global markets so much that bulls had no place to hide? Long trades were decimated in all markets from Asia to Europe to America.In Japanese markets there was bloodbath with Nikkie225 losing 624 points, down 3.6%. So what did Bank of Japan do in it's policy announcement that horrified the investor community and made them dump everything in sight? Bank of Japan took following monetary policy decisions:-BoJ kept its Deposit Rate unchanged at -0.1%.BoJ maintained it's Asset Purchase target at 80 trillion Yen (USD 738 billion as of current conversion rate). It gave some relief to quake hit areas by offering zero interest rate loans to those areas.Result of BoJ Inaction: After the announcement by BoJ, Yen roared into super-drive and strengthened from 111.88 to 108 against US Dollar. Presently it is trading at 108.5 as of going to press. Japanese economy is export oriented and hence Yen gaining so much strength against US dollar means that export of Japanese companies will no longer be competitive. That will directly hit the top line of companies, finally effecting their bottom line.What was wrong with BoJ decision?Will someone please tell me what was so terribly wrong with BoJ decision. It basically did not alter anything from what existed since February 2016. Maybe it was scared to shake the equilibrium in the market as it existed. And look what it achieved - just the opposite!.Why did BoJ keep rates unaltered?BoJ thought not to change anything because it got scared of consequences. When it decreased Deposit Rate from +1% to - 1% last February, a sharp drop occurred in stock prices. This time around it did not want to take the blame of upsetting the market. And yet it did!What did market want from BoJ?We live in bizarre times. Negative deposit rates mean that if you deposit money with Central Bank, you will have to pay for it and not get paid.. Did market participants want further cut in deposit rates? I don't think so. That would have been disastrous for Yen- Dollar trade. Japanese exports would have got further hit.Did market participants want BoJ to increase deposit rate to pre-February rate of +1% ? That would have effected liquidity. Entire exercise of negative rates was meant to spur growth for Japanese economy so that it can come out of decade long stagnation.Maybe market participants wanted BoJ to decrease the borrowing rates to negative territory. That would mean that you get paid for taking loan from Central bank. Point to ponder!Illogical Market ReactionJapanese companies are effected and so is Japanese economy. Economy will shrink and deflation will take roots. But that has been the state of this third largest economy of the world for nearly two decades. How does that effect global economy?Global economy has been chugging along despite Japanese stagflation for years. What has materially changed in global economy with today's inaction of BoJ ? Then why such a violent reaction in global markets to BoJ decision? I have no answer. If anyone reading this can provide an answer, we all will get educated. Hit the comment button at the bottom of this post freely.As of now Dow is trading 58 points down. US market participants have reacted more maturely to news from Japan. May be it will make rest of the world think and act logically tomorrow.Sun is finally setting in the land of rising sun. That is a reality and we have to come to terms with it - earlier the better.
Beginning of End of Oil Age - Saudi Vision 2030# Saudi Arabia got its importance and wealth from US oil crisis in 1970s.U.S. response to the energy crisis was to establish deeper relations with Saudi Arabia. Deeper relations boiled down to two main points of agreement:-Saudi Arabia will have to sell its oil in US dollars only. It's implication is that any country wanting to buy Saudi oil will first have to buy US dollars to pay for oil purchased from Saudi Arabia. Thus began dominance of Petro-Dollars in world economy.In return Saudi Arabia got military protection from US.Importance of Saudi oil started to change from 2009, when US oil production increased year on year. Increase in US oil production carried on unabated and Saudi influence declined proportionately.To add insult to injury, more factors surfaced on the horizon for Saudis' discomfort :-New technology allowed further increase in US oil production through fracking (Shale gas).US no longer is energy dependent on Saudi Arabia.Saudi Arabia allowed oil price to plunge, hoping to make offshore drilling and Shale Gas production economically not viable. By doing so, Saudi's calculated that they will decimate competition and again rule the oil market.Instead something very strange happened. Unimaginably low oil price did not increase demand in oil. Demand destruction in oil was due to global financial crisis in initial stage. Then governments across the world started to curb use of oil and started investing in cleaner and greener alternative energy sourcesG-7 countries have agreed to cut carbon emissions and totally end fossil fuel use by end of this century.Paris Agreement on Climate Change last December commits all countries to holding global temperature rise to "well below 2 degrees Celsius". This can be achieved by sincerely shunning fossil fuel in an accelerated manner world over.Some more thoughts on fossil fuel in this post: Break Free from Fossil Fuel - Resolve on Earth DaySaudi Arabia has now realized that it has lost control over oil price. Iran's entry into the fray as another major oil producer has not helped the Saudi cause. As last ditch effort Saudis played Doha Summit card for production freeze so as to contain Iran. But Saudi bluff was exposed by Iran and rest is history. Read more : World Waits with bated Breath - Doha Summit Outcome How Will This Sunday Be - Black or Grey?Last Monday Saudi Crown Prince announced pompously that Saudi Arabia will become oil-independent for its survival in next four years. He unveiled "Saudi Vision 2030" - an ambitious plan to diversify into income streams not dependent on oil.This is admission by Saudi Arabia that it has finally given up hope of controlling oil price. We can now expect to be freed from the vice like grip of oil cartel headed by Saudi Arabia.Before Doha Summit, Saudi Prince had threatened to increase oil production in case Iran did not sign Production Freeze agreement. I had commented that it is empty threat to scare US, so that Iran can be pressured. You may again like to read my argument in: Dare Saudis to Execte Threat to Ramp Up Oil Production."Saudi Vision 2030" has finally brought curtains down on fight to control market share. This will help oil price to stabilize and get dictated by market forces of genuine demand and supply.However we wish Saudis success in their new venture.As for us, we are presently unemployed. We are sitting on the sidelines, watching fight between bulls and bears in US markets. For insight into our present idleness read " Out of Work But Thankfully Out of Danger - US Markets Dive "
Dow In Negative Territory - Are You Scared US Markets Will Crash?# US markets have risen too much too fast. From mid Feb 2016 to date (in about two and half months) Dow has gained 2700 points (approx).This was achieved without any significant correction.That has given credence to market speculation that US markets may collapse any time. Are you stressed by such announcements?Let me categorically state that US markets are not going to collapse any time soon. Dow may drop down to 17200 in a worst case scenario. In such market condition, Dow will find support at 17200 and rise.Reason why I am saying so is simple. There is long term support at 17200 level in Dow. However, Bank of Japan and US Fed will have to spring some nasty surprises this week for Dow to touch 17200.In the absence of any shock from Fed/BoJ, Dow will go into sideways movement in coming days. Is this a Bull-Trap?Let me draw your attention to the fact that I had forewarned you about a Bull-Trap when Dow was near 18000. It was mentioned last week in this post . Relevant excerpts are again reproduced here for your eyes only."The best case scenario is that the sell off in equity markets takes place in slow motion. Big players may choose to exit their positions in a classical "Distribution Process" so that they can obtain reasonable price for their huge long positions.So you may witness very high volatility with spurts of buying interest emerging and trying to draw eternal bulls into a bull trap. That is the shade of grey for you!. Keep out of markets and watch it from sidelines till dust settles down. I will keep you posted and immediately inform you as and when that happens. Be safe, be happy - adopt a no-trade strategy for the moment!!!"Buying interest was generated when after Doha Summit debacle, Dow jumped from 17900 to 18150. From then onward there has been a steady slide. Are we witnessing the "Bull Trap" theory being unfolded?Now the question is: How sapping will the Bear Hug be? I think not very sapping. If this is a Bull -Trap then bears will ensure that markets rise from their lows. This will be done to entrap more bulls, before settling down into a bear phase. In short, be ready to witness sideways movement in US markets as I had mentioned at the beginning of the post.As of going to press, Dow was down more than 100 points at 17890. Are you not happy that you are away from this volatility? Stranded with long positions, spoiling your mood and mental make-up, is quite disturbing!So enjoy money saved by employing "No-Trade Strategy" as recommended by me in my earlier post. Check it here. Snippets from that post is shared again."But right now we should have market strategy to sit on the sidelines. Let various forces of pull and push play out. Let clear trend emerge and then I'll tell you confidently to enter trade for definite gains, like I always been doing"
Break Free from Fossil Fuel - Resolve on Earth Day# Earth Day was celebrated world wide on 22 April- a day to reflect on environmental issues of our planet. On Earth Day let us spare a thought for our environment - not for any lofty abstract charitable symbolism but for our own survival on this planet.We must debunk the myth that any step to protect environment, will save our planet. It will save us.When we tackle environmental issues with positive action, we are saving ourselves, and not the planet. This planet will survive any environmental catastrophe, but humans will not.So let us do ourselves a favor - protect our environment. In this process we will save our species from extinction. Earth has and will survive many such catastrophe.Fossil FuelThis Earth Day let us resolve to phase out fossil fuel from our environment.We the people of planet earth, have to set urgent realistic deadlines and act firmly to throw out fossil fuel from our ecosystem. Once and for all!Break free from fossil fuel within next 10 years. It is possible if we have many more Elon Musk (CEO Tesla Motors) on earth.We must have many variations of Tesla by many other automobile companies. Automobiles consume 60% of world's total oil consumption. Replace fossil-fuel-guzzling automobiles with clean efficient Tesla-kind-of-electric automobiles and enjoy pollution free cities.Recent precipitous fall in crude oil prices will help the cause of fossil-fuel-free world.Find ways and means to keep oil prices low for a long time so that oil business is no longer lucrative, and finally gets abandoned by big influential coteries and countries.Peabody, world's largest coal company, recently filed for bankruptcy protection in US owing to falling demand of coal. This space should quickly get filled by renewable energy.Technology enhancement in renewable energy should be a global effort, backed by governments under UN umbrella, and not left to corporations. Then only renewable energy will be accessible, cheap and user friendly for mass consumption.Peek at US Markets from SidelinesDow opened the day at 17985, rose to a high of 18027 , then plunged to a low of 17910 and recovered smartly to be slightly in green.Important points to keep in mind for Dow :-If Dow closes flat today, then it will be very encouraging for bulls. It will mean that Dow has taken support from 10 EMA and declared it's intention to move higher on Monday. I am expecting that low and high made so far in Dow, remain intact in trade today.On Monday, if Dow does not violate today's low(17910) and closes above today's high(18027) - then we can expect Dow to touch 18300,
Out of Work But Thankfully Out of Danger - US Markets Dive # We went out of business when Dow reached 17900 last Friday. I had asked my audience to exit US markets with Dow between 17990/17950. Dig out details here.I not only asked my audience to exit markets, I also told them to stay on the sidelines. That makes us unemployed - watching the battle from gallery. Probe yourself. If you are short of time to probe, examine the operative paragraphs :-"The best case scenario is that the sell off in equity markets takes place in slow motion. Big players may choose to exit their positions in a classical "Distribution Process" so that they can obtain reasonable price for their huge long positions.So you may witness very high volatility with spurts of buying interest emerging and trying to draw eternal bulls into a bull trap. That is the shade of grey for you!. Keep out of markets and watch it from sidelines till dust settles down. I will keep you posted and immediately inform you as and when that happens. Be safe, be happy - adopt a no-trade strategy for the moment!!!"Watching from sidelines, you can witness battle raging between bulls and bears. Today bears seem to be winning. I have been maintaining in all my previous posts that bears will defend their last known territory between 18000/18200 in Dow. You can find mention of this here or read the excerpts below ;-"I still maintain this view that there is no point in sticking one's neck out when Dow is in its long term selling zone of 18000/18200. Bears by all means will defend this last territory. Once out of this territory,Dow will be breaking new grounds - where no man has ever been before! All- time- high of Dow is 18351."US markets are down more than 100 points at the moment. Don't you agree that we are safe sitting out this volatility? It is very difficult to be holding positions in such times when there is no clear trend.At such moments you cannot even build short positions. For all you know, tomorrow you may find Dow 100 points higher. One thing is certain though - definite move either way will be signaled by an intra-day movement of 300 points in Dow in that direction. Therein lies your indication to trend development. Watch this space regularly for updates and call to action. Also, your comments will be most appreciated. So take out few minutes to do me a favor and comment without any inhibitions.
Chinese Invade IMF - Yuan Set to Become Reserve Currency# At peak of last global financial crisis of Sub Prime fame, Chinese leadership publicly criticized international monetary system. China chided that a international monetary system solely dependent on US Dollar for stability, will be prone to disaster. From there started Chinese quest to invade international monetary system.China went about being the good guy and convinced IMF executive board that Yuan meets standard of "freely usable" currency. It also observed all IMF compliance rules to get approval for entry into SDR (Special Drawing Rights) basket.Countries can use SDR to supplement their reserve currency. IMF member countries holding SDR can draw any currency from the basket to meet balance-of-payment needs.Presently this basket of Reserve Currencies has US Dollar, Euro.Yen and British Pound. On 01 Oct 2016 Yuan will join these privileged currencies to stake claim to Global Reserve Currency basket with weighting of 10.82%, ahead of Yen and British PoundAre you convinced that IMF has rightly approved Yuan as Reserve Currency? Chinese leadership has long history of being secretive and manipulative in their demeanor. All economic activity and data are either hidden from international scrutiny or fudged.China has always been cheating on its currency and has pegged it artificially and arbitrarily to the dollar.Despite its dubious track record on monetary front, China could win IMF approval by opening its onshore Bond and Currency markets to foreign Central Banks. Plus it reported its reserves to IMF - Bah Big Deal!!No one is sure these reserve reports are true or not.China recently reported its Gold reserves as 1658 metric tons after a gap of six years. This is close to last reported figure six years back. However experts believe that it should be nearly double that figure at 3000 metric tons.Who should we believe? I am with the experts who keep a close tab at various bullion activities of the dragon nation and have nothing to gain by falsifying figures.Why IMF ignored Time Bomb called Chinese Economy?Chinese economy is in shambles with balloons all over. Which of these balloons will burst and when, is anyone's guess.In my earlier post I had mentioned China as one of the three factors that can crash global markets. Other two factors mentioned in that blog were Oil and Brexit. You can again visit the post : Bears Sharpening Daggers - US Markets in Danger of Bear GripVery briefly we will go through present state of Chinese economy to get the full import of IMF decision :-Chinese stock markets, barometer of health of any economy, have simply collapsed. Shanghai Composite Index has sunk from 52 week high of 5178 to 3042 - loss of 41% in a year. Moreover it is hurtling towards 2000 level. Remember stock markets are leading indicators to overall economy by six months.China is in midst of oscillating between bubbles - it moved from real estate bubble to stock market bubble to bond bubble and presently has come back to real estate bubble. Property markets in Shanghai rose by 25% year-on-year.China released its GDP figures which simply do not add up. Figures are too smooth to be believed. When they had largest annual decline in rail freight traffic ever reported, how has GDP grown?China is a debt fueled economy. Moth-eaten corrupt sectors like real estate are being merrily funded.Chinese banks have trillion dollars as bad loans (NPAs) and are collapsing under the burden. Recapitalizing such a huge capital is not an option with the govt. China has not even come clean on the total extent of bad loans that their banks are reeling under.Since the present dispensation took over in 2012, no economic reform has been carried, except anti-corruption drive within party with the sole aim of hogging and concentrating power.The laundry list of Chinese Machiavellian machinations goes on and on. Yet IMF would like to hand over international monetary strings to China? Beats me! If anyone in the audience has different take, please do comment to make us wise on this issue. Whether in agreement or not, your views on the subject will go a long way in shedding more light. So do us a favor and comment uninhibitedly. Glimpse of US MarketsGoing to press, Dow was trading at 18041, down 11 points. It opened at 18059, made a low of 18031 and high of 18078.I am still maintaining my stance of recommending no action in US markets till clear trend emerges. Remember we are right inside the Resistance Zone of 18000/18200 in Dow. If you missed my recommendation detailing this strategy, here is the link again.I will be waiting for your comment!
Hear Bulls Roar - Dow Positioned to Break New Ground?# Bears running for cover! And there is none.From Asia, Europe right up to America, there is no place for bears to hide. Everywhere bulls are in full control. Markets are in all shades of green, but green all the same.Oil is up by 0.5% - and surprisingly enough Gold is also up. Bulls are running amok and have inadvertently stepped into gold bastion. But once there by default, they are piling up bullion. Someone please explain more rationally!!Yesterday Dow recovered form day low of 17848 and closed at 18004, after making a high of 18010. This means that Dow swung a neat 62 points from day low to reach its high. All this was done in gloomy and uncertain situation of oil plunge. Very creditable!Feeling Left Out of the Celebrations?Today Dow has opened in green at 18014 and is at present up by 37 points. But we are out of work, isn't it? That is because I told you to book profit when Dow at 17900/17950 as per my earlier post.Snippets from that post Bears Sharpening Daggers - US Markets in Danger of Bear Grip"Bears are gleefully whetting their hatchets and tomahawks, waiting for markets to open. So the wise thing to do would be to square off all long positions between 17900/17950 in Dow.I agree that you would feel cheated if Dow was to surge northwards, but it is better to take profits off the table. Remember we had built long positions as per my advice at 17400 in Dow. If you take profit at 17900 you still would have accrued 500 points in Dow.Massive resistance in Dow Jones exits at it's long term selling zone of 18000/18200. No need to take extra risk in hope of collecting 100 Dow points more, with dark clouds gathering on global stage"I still maintain this view that there is no point in sticking one's neck out when Dow is in its long term selling zone of 18000/18200. Bears by all means will defend this last territory. Once out of this territory, Dow will be breaking new grounds - "where no man has ever been before!". All time high of Dow is 18351.What we are witnessing now may be some sort of trap being laid for bulls. I had mentioned it in a post last Saturday. Sample the snippets from the post How will this Sunday be - Black or Grey?"The best case scenario is that the sell off in equity markets takes place in slow motion. Big players may choose to exit their positions in a classical "Distribution Process" so that they can obtain reasonable price for their huge long positions.So you may witness very high volatility with spurts of buying interest emerging and trying to draw eternal bulls into a bull trap. That is the shade of grey for you!. Keep out of markets and watch it from sidelines till dust settles down. I will keep you posted and immediately inform you as and when that happens. Be safe, be happy - adopt a no-trade strategy for the moment!!!"Please don't get trapped!!
Dare Saudis to Execute Threat to Ramp Up Oil Production !# Saudi Prince threatened last Thursday that if Production Freeze at Doha Summit was not agreed to, then they could ramp up oil production by extra 1 million barrels per day. Now that there was no deal at Doha on Sunday, we dare them to ramp up production as announced. We dare them to shoot themselves in the foot. We dare them to carry out their puerile threat. We, the people of planet earth, dare them !!We are tired of Saudi shenanigans. They are at this mischief for so long that it is not funny any more. As many aver, even with trillions of petro-dollars Saudis have not done one single act of goodness for mankind. In fact its the other way around!For investors in oil, there is no reason to panic. This fall was expected which I had announced on Saturday itself. If your are visiting this space for the first time then I recommend you to read following posts before proceeding further :- How will this Sunday be- Black or Grey? World Waits with Bated Breath - Doha Summit OutcomeLets analyse the situation as it exists today. Crude is down 2.9% at 39.3 USD as of publishing this post. It has recovered lot of lost ground when earlier in the day it had crashed more than 5%, day low being 37.61 USD.Why am I saying there is no reason to panic for oil investors. Oil can go down to 35 USD this week but that is all. In fact many believe that NO Deal at Doha has been a boon in disguise for long term stability of crude oil market.Forces of demand and supply will realign in a structurally sound manner. Supply side constraints will develop as production in many oil producing countries will be curtailed owing to prolonged low prices not being viable, including shale gas production in US. Offshore drilling will be simply untenable.On the demand side one is expected to see small incremental steps of growth as global economies claw out of mire. Local politics, if not anything else, will compel nations to increase productivity in many ingenious ways. After all recession also has shelf life!Glimpse of US MarketsDow is up 59 points at 17956 as of going to press. Moving in tandem with oil. Dow has also recovered from its day low of 17848. But we are not trading - remember? I had asked my audience to exit market at Dow in range 17900 - 17950. That was on Friday and you may check it here.This exit has given us a profit of 500/550 points in Dow since we entered market when Dow was at 17400 as per my recommendations. Check it out here.But right now we should have market strategy to sit on the sidelines. Let various forces of pull and push play out. Let clear trend emerge and then I'll tell you confidently to enter trade for definite gains, like I always been doing. Remember trading gains of 700 points jump in Dow from 16500 to 17200!Enjoy no work!!
World Waits with Bated Breath - Doha Summit Outcome# Will they, will they not? That is the moot question that investors, especially oil traders are asking around the globe. And 'They' are the major oil producing countries. These countries will go into a huddle to decide whether they should announce a production freeze on crude output so as to restrain the supply of global oil or not. With supply side contained, these oil producing nations expect oil prices to increase.In Doha Summit there will be 12 OPEC nations participating, with Libya abstaining. Iran will attend but will send a delegate instead of its Oil Minister.. Others attending are Saudi Arabia, Iraq, UAE, Kuwait, Angola, Algeria, Equador, Indonesia, Qatar, KSA, VenezuelaSeven non-OPEC countries have been invited. Out of these seven, Russia, Bahrain and Oman are sure to attend. Mexico will send its observer. It is not clear whether invitees Azerbaijan, Norway and Kazhakstan will attend or not.That this Summit is bound to fail has already been discussed in my previous post How will this Sunday be - Black or Grey?. But some important aspects which need to be kept in mind are mentioned below :-This exercise of Doha Summit for Production Freeze of Oil output was a ploy by Saudi Arabia to stop Iran from hiking production. Iran has called the bluff of Saudis by insisting that it wants to ramp up production till pre-sanction level of 4 million barrels per day is achievedSaudis have cleared their stance of not signing any treaty without others, specially Iran agreeing..Iraq cannot stop production hike as its economy is in shambles and needs extra money for its army to carry on its campaign against Islamic State.Saudi Prince has threatened to increase production by 1 million barrels per day, if there is no production freeze.Most countries are already pumping out oil at their maximum capacity, except Iran and Iraq. So production freeze summit is just an eye wash.Be that as it may, the very news of no production freeze coming out of the summit will make oil to crash to 35 USD per barrel over the coming week. At that level oil should find support again, since some sense will prevail over oil traders that Oil Production Freeze Summit at Doha was just a charade, and nothing more.
How will this Sunday be - Black or Grey?# Yesterday my call-to-action in US markets was for booking profit at 17900/17950 in Dow. Check it out here. That call was given before the markets opened. Dow opened at 17925, reached a high of 17938 and finally closed at 17987, down by 29 points from last closing.Trade in US markets was testimony to the confusion that prevails in trading community. Tug-of -war of sorts between bulls and bears, if you may! This situation of uncertainty is mainly due to a divided house on how Doha Meet on Oil Production Freeze will pan out coming Sunday.Frankly speaking I have no hopes from Doha Meet of major oil producing countries. This aspect I had covered in my last post Bears Sharpening Daggers - US Markets in Danger of Bear GripHow can you expect consensus from a motley crowd with divergent geo-political interests and views? Some of these countries have been serious adversaries for a long time with ethnic and sectarian undercurrents. And we are supposed to pin our hopes on a consensus from them? Not me.What we can expect tomorrow is Black Sunday, as Doha Meet winds up with no production freeze. I say Black Sunday because that will galvanize a furious sell off in oil prices. Presently equity markets are moving in tandem with oil market, and hence I leave it to you to draw conclusions. Since equity markets are not decoupled from oil prices, I expect a mayhem in US stocks.The best case scenario is that the sell off in equity markets takes place in slow motion. Big players may choose to exit their positions in a classical "Distribution Process" so that they can obtain reasonable price for their huge long positions.So you may witness very high volatility with spurts of buying interest emerging and trying to draw eternal bulls into a bull trap. That is the shade of grey for you!. Keep out of markets and watch it from sidelines till dust settles down. I will keep you posted and immediately inform you as and when that happens. Be safe, be happy - adopt a no-trade strategy for the moment!!!
Bears Sharpening Daggers - US Markets in Danger of Bear Grip# There are grave dangers for bulls in US markets. I had cursorily mentioned about a clutch of them in my earlier post What will topple markets - Crude, China or Cameron?This post is a call to action before opening bell for all those who are long in US markets as per my recommendation. It is serious and urgent situation and I shall give detailed reasons in succeeding paragraphs.Bears are gleefully whetting their hatchets and tomahawks, waiting for markets to open. So the wise thing to do would be to square off all long positions between 17900/17950 in Dow.I agree that you would feel cheated if Dow was to surge northwards, but it is better to take profits off the table. Remember we had built long positions as per my advice at 17400 in Dow. If you take profit at 17900 you still would have accrued 500 points in Dow.Massive resistance in Dow Jones exits at it's long term selling zone of 18000/18200. No need to take extra risk in hope of collecting 100 Dow points more, with dark clouds gathering on global stage. These dark clouds are in shape of following events lurking round the corner:-Doha Meet on Crude Output Freeze. On Sunday Oil producing countries are coming together at Doha for a Meet on Crude Output Freeze. Iran oil minister says he will miss Doha meet. Saudi Arabia indicated that it won't support any output freeze accord unless Iran signs. Iran - Saudi rivalry will not allow any ouput freeze.Iran has rejected call for output freeze because it wants to attain pre-sanction output of 4 mln brls per day.Long and short of the above inputs is that there is likely to be no cut or output freeze on crude and hence oil prices will start falling from next week. This will negative for stock markets which will see bears taking firm control of markets.China US is stationing warplanes in Phillippines this week as vanguard of a major deployment there. This is in response to Beijing's assertiveness in South China Sea. US deployment is seen as a means of alleviating tension in the region. Tensions are escalating as United Nations backed arbitration panel in The Hague prepares to rule in a case brought by Phillippines against China's maritime claims in South China Sea. This is due to concerns over China's construction of artificial islands in South China Sea and its recent deployment of weaponry on a disputed island. China's grand strategy is to use the world as one big supply chain.China's love for madcap dictator of North Korea and his antics.China's slowing growth, likely property bubble burst and debt burden on its banks can be reasons for global economic tremor.Any or all of these reasons can surface over the weekend to sour investor sentiments in the market.Cameron & BrexitReferendum on Britain's exit from European Union (Brexit) will take place on 23 June 2016.Last week Saturday thousands of Brits swarmed the streets of London demanding Cameron's resignation in light of Panama Papers leak. The papers linked him to having invested at one point in offshore funds his late father had created. Over the weekend any adverse news on these fronts can make the markets tumble with banks leading the down-slide.You would agree that in such a scenario there is no point in showing bravado, if you are a bull. Exit from your long positions as US markets open today.
Thrilling Race To 18000 in Dow - Will We Witness It Today?# US markets gave a captivating performance in last trading session. Dow rose from a day low of 17742 to a day high of 17918, finally settling down to close at 17908. That is as bullish as you can lay your fingers at!There were a couple of compelling reasons for such a fascinating journey northwards in US equities. Most compelling reason for this bullish lift off was JP Morgan coming out with good results. While the street was expecting poor show from financial institutions, out came results of JP Morgan sweetly surprising market participants. Bears were caught unawares and got painfully caught in a bear trap.Well that seems almost history now. Dow Jones has marched majestically towards its psychological level of 18000. Now the most important question is - will Dow achieve 18000 in trade today? I think it will, although Dow should open flat. As of publishing this post, European markets are marginally up and Dow Futures is also slightly up. Oil after being in red has shown strength and entered into green territory, which is good news for bulls.If Dow misses 18000 today, I am sure traders will take the index to this important level before going on weekend holiday.But what after that? After Dow reaches this psychological level, we should be on a look-out for correction. So we must exit all our long positions in Dow. I must admit that Dow may go even higher than 18000 before correcting, but that will be taking high risk. I say so because 18000/18200 in Dow is a strong resistance zone. Keep watching !
What will Topple Markets - Crude, China or Cameron?# Global markets across Asia and Europe are in supreme bullish fever. Everywhere there is welcome green, and that too of deep hue. Dow Futures is 89 points up. But crude is down. which may prove to be a spoiler in trade today.Judging from situation US markets should open with a gap up. After all it has to reach 18000 destination. Check it out in this blog post.In this wonderful bull run starting mid Feb 2016, there has to come a time for meaningful correction. Traders will take some excuse or the other to book substantial profit.Will that excuse be provided by Crude or China or even Cameron? We will intensively investigate and analyse that in my next blog post. So keep lookout for in-depth analysis of impending correction in US markets in this space.
Enjoy the Journey - Dow Is Squarely on Way to 18000 # US markets ended last trading session with a strong close, with Dow closing 165 points higher.Those who have been acting on my buying advice given in this blog, must be enjoying the ride in US markets.Right from 17400 level in Dow, I have been pleading with my readers to buy US markets since I could see that Dow Jones was headed to 18000. That is 600 Dow points on offer, which means that even if you had chosen the wrong scrip to buy, you would still be in profit, albeit small.I have continuously maintained through this blog that it is time for buying action. You can check out in this post on 30 March 2016. And I continued exhorting my readers to buy US markets at every opportunity even after publishing this post on 30 March 2016.Before this recommendation of buying, I had earlier advised my readers to buy in US markets when Dow was at 16500 and sell when Dow was at 17200. That is cool 700 points in Dow achieved in just 15 trading sessions. Check it out here.I hope I am making my point. If you are here reading this blog and you are in US, then do profit from my recommendations. I am not asking you to blindly follow me. You can perform your own research to my recommendations, or take advice of experts you trust. After that arrive at a decision to whether follow my recommendations or not.Whether you agree with my views or not, I would only request you to air your opinion in comments section of this blog. It will compel me to reconsider my views when you disagree. I am sure your views will be valuable to other readers also. Plus it will delight me to no end!
Worried About Earnings Season In US? - Banks Expected to be Culprits# If US markets fall in this earnings season, Banks will be leading the fall.Banks are potential under-performers and this earnings season they could be the biggest drag to US stocks..For economy to do well, its banking sector has to be at least on even keel, if not racing on full throttle. But with ultra low interest rate causing ripple effects on banks' balance sheets, results of banks can be anything but ugly. Dovish stance of Fed on future rate hikes as also sharp decline in oil prices have not helped..So be ready to get jolted this earnings season by dismal results of US banks. Other positive corporate earnings may act as countervailing effect to banks' earnings for US stock market to absorb the shock.However, today Dow should remain positive since oil is up along with gold. It seems investors are slowly tucking away proceeds to gold as a safe haven, just in case the stock market tumbles. That can only explain gold price rising with the stock market. And yes, Dow futures is also up.Oil being up is definitely a positive for the stock market. So be ready to welcome Dow in green territory today.
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