June 2012

US intra levels ... for 4th june 2012

Trading levels 4^th / 8^th June 2012

IF TOO BIG TO FAIL was the maxim in 2008/09 … during the Lehman crisis ….. now the new maxim is TOO BIG TO SAVE …….. While we are just getting used to a possibility of GREXIT …. Greek Exit … the next euro-zone problem is snowballing ….. SPAIN.

Spain is simply too big to save. Greek economy is just about 230 billion Euros and even if the parties which don’t want to honour bail-out treaties - signed 4 months ago - come to power, they could be possibly silenced by giving additional package of 10 % - 23 billion Euros.

But Spain is simply too big … Germany will have to accept downgrading by rating agencies in trying to save Euro-zone and then in that case, Germany is bound to decide to exit Eurozone and that will be epitaph for the combined euro-zone dream.

What will follow in the world including euro-zone will be economic mayhem and the situation will be akin to great depression in 1930s … LET US HOIPE ALL WILL NOT UNFOLD THE WAY I HAVE DESCRIBED ……

It will not happen overnight and may take even up to 12 to 18 months … but it is better to be forewarned about such a doomsday scenario.

On Monday, we will have a retest of 4770 / 4780 zone …. And it is very crucial to watch whether that support holds or gives way … I will put 70 % chance for nifty going thru that level and then staring at December lows.

The world markets have simply caved in on Friday and that may mean a small bounce on either Monday or Tuesday. But basically the fabric has become very weak and the chances of going down further are 80 % against the 20 % for recovery.

Rupee showed a modest recovery on Friday …. But if we slip below 56.5 on daily closing basis …. Then we have 58 and 59.7 coming rather quickly. It is possible that simultaneously, we may hit December lows on NIFTY as well.

JUNE trading levels for large cap indian stocks + indices .....