In 2005, we had all along maintained that the markets are bullish – and our expectations were not belied. Also, the basic support levels have remained unviolated in the last 4-5 months. Going forward, new developments suggest that the 7500 area continues to be a very strong long-term support for the Sensex. The long-term bull trend in the market is thus intact. In fact, technically, the way is now open for the Sensex to hit the level of 18750. We see the Sensex reaching this target by 2009-10.

Technicals suggest a long-term bull trend ahead: The developments of the last 4-5months have been extremely bullish for the stock market. Sustained and determined buying has seen the index scale new heights in this period. More importantly, the index broke above the long-term resistance of 7500 and remained there. This has opened possibilities for an entirely fresh long-term bull trend to unfold with the minimum target placed at 18750; and we believe the target is achievable. There will of course be corrective phases along the way, but the overall technicals are quite robust. And we see no reason why the bull trend should fail to materialize.

We recommend Reliance Industries for the long term: The prices of Reliance have made a bullish breakout from a unique long-term rising wedge over the last few months. This pattern has been forming since March 1990 in its log charts. We believe that this breakout has set the stage for a significant bull trend ahead. The potential for a multi-fold rise from the current levels is extremely high in the stock. We recommend a Buy and Hold for long term strategy in this stock.

Global indices and commodities: The global metal markets have resumed their bull wave. The metals have broken out of major resistance levels and become open to further uptrend, which we believe would be of a sustainable nature. Crude has turned significantly weak in the medium-term perspective. Therefore, crude may have to consolidate over a longer period of time to generate technicals for a sustainable rally.

In the global stock markets, Chinese SSE remains under pressure. The other globalmarkets are basically bullish. We see a bullish long-term future for Nikkei.