The market action yesterday was terrible. It seems now everyone is rushing out of exit door at the same time. You can sense the panic by the way some of the popular mid cap stocks sold off yesterday. On a broader index, there was a total sell off with no place to hide. The comforting sign is that market did not crack below 200 day moving average yesterday. But that does not mean you can go out and buy. Market has yet to bottom out.

Year to Date (YTD), Nifty is now up only 2.7%. The key level to watch is 3966, and if Nifty slips below 3966, we will be YTD = 0.

Markets represent good value, but only if the economic and earnings expectations remain intact. With Global economic uncertainty and now domestic political instability, it's anybody's guess to what will happen to India growth story atleast in near to medium term. If the domestic uncertainty drags on for some more time, we may see some more selling. Today may well be the pivot point, and it would be interesting to see whether bulls are able to defend 4000/200 day moving average or not. Today's closing will give us a good idea on where we are heading.