how low can it get...

bear mkt is in full swing and seems like final capitulation is coming in.

how low can the index go to?

putting a number is very difficult to such a downside as lvls come and go and mkt falls further down.

the trend is strongly down and it makes no sense to go long or buy stocks immediately for investment even though they appear too cheap, let the mkts settle down and make a bottom and show real signs of moving up, even if one invests at these lvls will have to wait for long time 1-2 years for next bull mkt to start.

we had already discussed the worst case scenario.

but lets see how bad it can get.

elliott wave theory says bear mkts typically end near top of the first wave of previous bull mkt.

that lvl comes to 2014 on nifty and 6250 on sensex.

previous bear mkts had a drop of 60-65% from the previous bull mkt highs.

that means current one might correct to between 2221 to 2540.

since jan the nifty moved in fashion 6357-4448-5300-3790-4650-2700, every rise was approx 50% of drop and each big drop was approx 30% from its recent high, e.g 6357-6357x0.30=6357-1907=4450,5300-5300x0.30=3710, so drop from 4650 was expected upto 3255 but nifty continues to fall giving indication this may end up 50-60% or so which is 1860-2325.

my p/e chart had p/e data only for low of 10.84, bear mkts had earlier traded at a low p/e 9-10, current eps gives such a lvl 2300 unless the earnings take a hit.

its not necessary mkt will go down there, but who knows?

just as it is difficult to call mkt tops so are the bottoms. bull mkts end on euphoria and bear mkts end when pessimism is at its peak.