Cycles in the Indian market

Nifty 50

Continuing from the earlier post about cycles in the Dow Jones Industrial Average, we'll look at some of the cycles in the Indian markets- the Nifty 50 index and the USD/INR pair.


To start, I plotted a length of time from the 2003 low to the top in 2008 and extended it forwards and backwards. The previous cycle ran from the low of 98 just before the tech bubble took off in a final rally, and ends at the absolute lows of 2003. The 03-08 bull market is rather obvious. The next entire cycle the market dropped 50% and recovered, but never fully. Priced in USD, the Nifty is still below the 2007 peak. After lackluster performance for 3 years from 2011-2013, the market finally took off in 2014. The current cycle ends in January 2017. What follows from here? Another new bull market?

USD/INR

Next we look at the currency- the Rupee vs US Dollar.


The cycles in this chart are the best I've ever come across, and if you keep going further back, the cycles still hold right into the 1970s when the Rupee started depreciating drastically. It is really surprising that the length of time from the 2003 low to 2007 high is the the exact same length of time from the 2007-2013 high! The current cycle is only half way through, and it will continue until May 2019, which would be around the time of the next elections!