India Starts longer bull market that can last for another 15 years

Raging Indian Bull

March 25 (Bloomberg) -- India’s key stock index may be embarking on its second rally of a five-wave cycle that may help the benchmark surpass its earlier record high, according to technical analysis by Elliott Wave International Inc.
The Bombay Stock Exchange Sensitive Index may be breaking out from its downtrend line, Elliott Wave said in its Asian- Pacific Financial Forecast report. The index may be following the pattern of gains and losses set between 2003 and 2008, and may have already started on the next leg of a longer bull market that can last for another 15 years, the market forecaster said. “Prices in India’s Sensex have just broken above a downtrend line, imitating a pattern from 2004 that led a strong rally,” Elliott Wave International said in a report.
The Sensex rose 5.6 percent in the past two days, trimming the year’s loss to 1.8 percent, on optimism U.S. plans to rid banks of toxic assets will help ease the credit crisis and revive global economic growth. This five-wave cycle will include three rallies, with each peak exceeding the previous one. The first wave started with gains between April 2003 and January 2008, Elliot Wave said, while the bear market in the past year marked the second. The prediction of this rally, or the third wave, is based on a similar pattern of market movements within the first, the researcher said.
Elliott Wave Theory, created by U.S. market analyst Ralph Elliott in 1938, attempts to predict future price moves by dividing past trends into sections, or waves, and calculating changes in value. Gainesville, Georgia-based Elliott Wave International was founded by Robert Prechter, who was famous for cautioning investors that stocks would slump two weeks before the 1987 stock market crash.

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