How To Identify Market Tops and Bottom

There are certain characteristics of the markets that take place almost all the time, when the indexes are about to approach an intermediate or long-term top or long term bottom.  In order of importance, this is what you have to look at to identify market tops.

1. Time
2. Sentiment or Investors Expectations
3. Market Breadth
4. Price  patterns

Time Profiles: Major tops/bottom  are made after the markets have been going up/down for an extended  long period of Time. Indian Market follow the 8 year cycle , Major Tops are formed after 8 year, 1992,2000,2008 have been the major tops in Indian market. Next 2016 is on the line, so investors should be cautious in 2016 going by historical data.  But time alone will not give you the sufficient information you

Continue Reading