JAN EFFECT

Today while discussing about stock market with one of my friend, he mentioned that it has been observed that during JAN market makes top and start falling / correcting. Is it so or is it a myth ? I just checked our beloved NIFTY chart since 1995.

What is the answer ? If u observe the above chart it can easily noted that out of 18 jan months during 11 jan actually market has gone up from jan level while 7 times it fallen from jan level. So we can't conclude anything or cant say surely that most of the time market makes top during jan and start falling/ correcting.

If we take example of Jan 12 NIFTY on 2 Jan closed at 4636.75 and on 21 Feb it closed at 5607.15 that is it rallied almost 21%, after that it corrected 14%, made a bottom on 23 May 12 and once again  started its upward journey and up till now it gained 22% from closing price on 23 may 12 with intermittent corrections.

If someone  had invested according to the advice given on this blog without seeing short term fluctuations and trying to time the market his  investment have been grown by 25-30 % from 2 Jan till today.

So conclusion is ---- the market may or may not top in jan 2013. If it is going to top /  fall this we will come to know from short term technical analysis. So short term trader will  keep eye on intraday and daily chart and  take decisions according to price behavior , which we may or may not be able to update. LONG TERM INVESTOR SHOULD NOT WORRY SINCE AS OF NOW SHORT, MEDIUM AND LONG TERM TREND IS UP. AS OF NOW LONG TERM  TREND WILL TURN DOWN ONLY IF NIFTY GIVES WEEKLY CLOSE BELOW 5548.35

THE LESSON WE LEARNT  ONCE AGAIN --- " REGARDING STOCK MARKET DON'T RELY ON HEARD THINGS / RUMORS . TRY TO STUDY AND ANALISE MARKET SECRETS"


 DISCLAIMER: This Blog is meant for sharing our trading and investment ideas only and no calls to be taken as trading / investment recommendation. Visitors please do your own research or consult your advisers for safe trading, investing.