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Technical Analytical Outlook
Forced Selling Seems To Be Making The Market Weaker!!!
Most stocks are currently underpriced and are at bargain prices. But selling continues unabated. The only rational explanation to this strange phenomenon is that the brokers are continuing on a relentless forced selling and debt recovery process. This will obviously make the market weaker day by day. Last time the catastrophic failure in the market was halted by the intervention of H.E. the President. But what was approved at the meeting was not properly implemented. With a different interpretation of Net Capital. The result was the continued destruction of the retail client base. One mustn’t forget the fact that the meteoric rise in the market in the immediate aftermath of the winning of the 30 year separatist war was solely propelled by the vast number of small and medium sized players. These are the market participants that got nearly completely wiped out during 2011.
These small and medium sized investors do not have recourse to unlimited backup resources. Once wiped out they have no way of gathering fresh capital and coming back to the market. The only hope for the market is for the Government to actively intervene and remedy what is ailing the market. The tragedy is that when the retailers were getting smothered the Government institutions too withdrew their support.
The Rupee is stubbornly refusing to come appreciate and the interest rates continue to edge up. Exporters are hanging onto their dollar revenues expecting a further deterioration of the Rupee and the importers are accelerating the raising of LC’s for the same reason. Capital TRUST Research research@capitaltr
Forced Selling Seems To Be Making The Market Weaker!!!
Most stocks are currently underpriced and are at bargain prices. But selling continues unabated. The only rational explanation to this strange phenomenon is that the brokers are continuing on a relentless forced selling and debt recovery process. This will obviously make the market weaker day by day. Last time the catastrophic failure in the market was halted by the intervention of H.E. the President. But what was approved at the meeting was not properly implemented. With a different interpretation of Net Capital. The result was the continued destruction of the retail client base. One mustn’t forget the fact that the meteoric rise in the market in the immediate aftermath of the winning of the 30 year separatist war was solely propelled by the vast number of small and medium sized players. These are the market participants that got nearly completely wiped out during 2011.
These small and medium sized investors do not have recourse to unlimited backup resources. Once wiped out they have no way of gathering fresh capital and coming back to the market. The only hope for the market is for the Government to actively intervene and remedy what is ailing the market. The tragedy is that when the retailers were getting smothered the Government institutions too withdrew their support.
The Rupee is stubbornly refusing to come appreciate and the interest rates continue to edge up. Exporters are hanging onto their dollar revenues expecting a further deterioration of the Rupee and the importers are accelerating the raising of LC’s for the same reason. Capital TRUST Research research@capitaltr
Last edited by rijayasooriya on Wed May 02, 2012 8:14 pm; edited 1 time in total (Reason for editing : title shortened.)
