NIfty outlook

Nifty @4529 a whooping 700 points from the lows of 3800's.Is the market set to rally and all the bearishness has ended??.With crude trading below 118 dollars per barrell off from the highs of July 11 does that mean all pains are over??A look at the one year chart tells us that markets could have made a double top at 4620 and reversing from there.And after all markets have rallied 700 points and it makes sense to book profits. While crude might continue to fall that to me is no reason why markets should go up.Crude as a commodity would continue to fall with an economic slow down across the globe.When I rewind back at the bull run between 2004 to 2008,with markets trading on 22 times forward earnings,it was just the gush of money that was chasing paper.With interest rates on the higher side retail slow down in India most banks exiting select retail business the next 12 to 18 months isn't gonna be all that rosy.Interest rate sensitive sectors like Auto and two wheelers would have to part away with profits to keep up the shop floor running.Every up move could be viewed as an opportunity to exit or build short positions on the F&O side.Needless to say banking and brokerages would continue face the brunt of the pain in the current scenario.Power & infrastructure have always been long term and would show little recovery in such bearish conditions.With the dollar regaining its strength frontline IT and pharma stocks could be good bets in the medium term,Buying on dips in these stocks should deliver upto 40% returns on a one year time frame.Having said all that with the Nifty unable to breach the 4620 mark there is definitely more pain in the days to come.