1. Bullish channel remains intact
2. RSI although trending down, continues to remain above 50 line giving benefit of doubt to BULLs
3. MACD is also trending down, however appears to be on the verge of reversing the trend
4. PPO is also trending down but appears to be on the verge of reversing the trend
Think of this market like a sailboat moving in one direction with considerable speed. What has to change to make a significant difference in the speed and direction?
1. Wind speed increases but not violently giving a considerable push to the sailboat and as a result speed increases
2. Wind reverses (but not considerably) thereby decreasing the speed although sailboat continues to move in same direction
3. Dark clouds on the horizon causing wind shift violently which will force a directional change
4. Storms, wild winds, rain will certainly cause chaos and sailboat we get loose speed as well as direction
In short, unless a major event either disrupts or uplifts this market, expect the bullish channel to remain intact for a while.
What does it mean for our Investments?
- Mutual Funds - If already invested in equities then stay put and enjoy the bullish gains. If in cash/FDs/liquid funds then wait for next low risk opportunity.
- Stocks - ONLY invest in strong patterns with good earnings guidance and DO NOT forget to have STOP LIMIT on open positions. Check out our trade size calculator to manage your risk along with potential buy candidates watch list.
Market remains in strong bullish channel...