You all may have recently seen SENSEX breaking it’s all time high records and NIFTY a kissing distance away from it’s all time highs of 6357, but are they actually at their all time highs?
My answer would be NO, because the weakness of our currency Indian Rupee is yet to be adjusted to those market levels which we have seen in 2008 and were all time high levels.
S&P BSE SENSEX made it’s current all time closing high of 21,239.36 on November 3rd, 2013 in Muhurat Trading.
Let’s know what is the actual difference between 2008 & 2013 market highs.
USDINR Comparison for 2008 & 2013:
3/11/2008 – 48.96
1/11/2013 – 61.90
NIFTY – 2008: 6357, 2013: 6343
SENSEX – 2008: 21,078 , 2013: 21,321
Note: Above prices are intraday all time high’s, not the closing high’s.
Let’s take the USDINR as the base for comparison of the actual market values in 2008 & 2013.
Actual Value of NIFTY in 2013 = Actual Value of Nifty in 2008 X (USDINR Exchange Rate of 2013/USDINR Exchange Rate of 2008)
=> 6357 X (61.9/48.96)
=> 8037 (approx.)
Actual Value of SENSEX in 2013 = Actual Value of SENSEX in 2008 X (USDINR Exchange Rate of 2013/USDINR Exchange Rate of 2008)
=> 21078 X (61.9/48.96)
=> 26,648 (approx.)
So, the actual all time high (After rupee adjustment) of NIFTY is 8037 & SENSEX is 26,648.
As, we have seen Indian Markets cheering by breaking it’s all time high records but if we adjust our currency’s weakness which we have seen in the past 3-4 months the market is showing us another picture that actually it is not at it’s all time highs which is yet to break.
This is a better opportunity for Long term investors as they don’t need to get panic for new investments they can start investing at the current market correction phase where you can long your positions with strict stop loss, Yes Stop Loss is mandatory because these markets levels are just calculation of adjustments yet many factors are also responsible for market movements. So, one must strict to stop loss and take it’s long positions.
We still hope for markets to break these levels of 8000 & 26,648 of NIFTY & SENSEX respectively, where as the change in USDINR Exchange rate can upgrade or downgrade these levels as our adjustments are made by taking USDINR as base.
These calculations and advice are just for educational and knowledge purpose, taking decisions for investing as per these adjustments is solely yours.
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