Starts with cuts, China cuts the Reverse Repo Rate, News of Michael Burry shorts surface and talk of the town here also. To his credit he predicted 2008 crash and a movie also made. His recent warnings include the warnings in 2021 which have not materialised. Till a week ago, bears are dead story remained. Correction and crash are completely different aspects. Also, his positions are in Options which is completely different than lethal naked shorts. While contextually it is a news worth adding to the existing trend, but that is more applicable to overseas than to our markets save little, short-term correlation. Fitch warns of downgrades coming more and that include names like JP Chase, that sent the market to shiver and cover. What is to be watched for us. 1 The recent manufacturing and Industrial production data was week. 2. ICRR impact is liquidity negative 3. Inflation number 7.45% is steepest and its impact on bond yields to be watched which looks toward 7.35% last but not the least 4. USDINR moves as most of the EM and CNY on the fall. While these bags full of negatives remain to the bears, the bulls will be watching how strong 43300-500 will be protected. Looks we are one more step-down range of 43300-44300. Shorts below 44300, any existing longs to unwind. With Index also showing signs of corrective move down, caution is better word. Hedge appropriately remains the choice.
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