The bull market is here, that’s for sure: Deepak Mohoni

The market rallied further last week, with the Sensex finishing 3.21% or 604.75 points higher, and the Nifty ending 3.04% up. The CNX Midcap Index outperformed the two main indices, marginally with a gain of 3.90%.

DLF was the biggest winner among the index stocks with a 9.1% gain. The other index stocks to go up included Maruti Suzuki , Hero Honda , Reliance Infrastructure and HDFC , with gains ranging between 7.8% and 6.6%. None of the index stocks declined last week.

Atlanta was the biggest winner among the more heavily-traded non-index stocks with a 31% advance. The other non-index stocks to move up included Gravita India , DB Realty , Kwality Dairy India , Delta Corp , Reliance MediaWorks , LIC Housing Finance and HOEC with gains between 21.5% and 11.1%.

Acropetal Technologies was the biggest loser among the more heavily-traded nonindex stocks with a 16.7% loss. The other non-index stocks to go down included Piramal Healthcare, Tech Mahindra, Fineotex Chemical, Jain Irrigation, MOIL , Coal India and Sun Pharmaceutical, with losses falling between 13% and 2.8%.


The market's intermediate trend is up. The uptrend would end if the Sensex breaches 17,775, the Nifty 5,325, and CNX Midcap 7,525 (Figures rounded down to the nearest 25). The uptrend has been on since the Sensex's March 21 bottom of 17,792.


Our long-term (major) trend has been finally confirmed as up, meaning a new bull market is on the way. Several bull market signals were triggered in the past two weeks. The Sensex, the Nifty and even the CNX Midcap index have gone above their past intermediate tops. The Sensex and the Nifty are both above their 200-day moving averages. The same behaviour is being seen in an increasingly large number of stocks.The shortest bear markets of the past 25 years have ended within three months, and the mildest ones had a 20-25% loss. The bear market which may have just ended shows a decline of 18% in a little over three months.

The bull market has started on February 11 when the Sensex bottomed out at 17,295. The index has been among the best global performers since then, just ahead of Indonesia, the Philippines and South Korea.


Existing portfolios should be held on to as we are in a bull market now. Even the more volatile stocks are somewhat safer, as the bull market has reduced the downside risk. Investments should now be made after the next intermediate downtrend develops and runs for a week or more.


A few global markets, including the Dow and the Nikkei, are in an intermediate uptrend now, and the recent rally may have placed many of the others in unconfirmed ones. The Dow will fall into a downtrend should it breach 12,140.

Global markets have generally been in bull phases for several months. Our market and Brazil had been among the very few exceptions, and Brazil too may be bottoming out. Japan crashed into a bear market territory following the recent disasters, but has already recovered over half the lost ground. The Dow would go into a major downtrend if it were to breach 11,500.

The Sensex had gained 9.9% in the 12 months that ended on Thursday, up six positions to the 16th place among 35 wellknown global indices considered for the study. Sri Lanka continues to head the list with a 92.9% jump.

Argentina, Indonesia, South Korea and Denmark follow. The Dow Jones Industrial Average has gained 12.8% and the NASDAQ Composite gained 15.8% over the same period. (These rankings do not take exchange rate effects into consideration).