Considering the extreme volatility in the markets, the lower circuit in the Nifty and the 1000 points bounce back, it is hard to formulate a meaningful trading strategy. Here are 3 ways to approach the market at the current juncture.

(a) Are we in the midst of a bear market? A bear market is defined as 20% correction from the peak. Nifty and Sensex have lost 23% from the peak and so we are in bear territory. Dow and other European indices have also lost 27% in one month.

(b) Broadly, there are two possibilities. Markets may behave like 2012 and 2016 when markets bounced back sharply after a 21-24% correction and went on to scale new heights in less than a year. The other option is a prolonged bear market like 2000 or 2008?

(c) Investors normally tend to wonder if this is the level to jump in and buy? Many of the stock are at extremely attractive in relative valuation terms but if the global carnage continues there could be more pain. While you don't catch the bottom, try and be as close to it.