Market is currently in resistance zone and has managed to stay near TOP area for past week. Breaking through the resistance zone might need strong push which may not be easy, hence be cautious. Whats is in store for us?
Not much has changed in below chart:
- Top chart - Nifty is near HIGHs while MA(100) remains below MA(200). If any massive rally is going to start here then MA(100) has to move above MA(200) until then this market is going NO where.
- Bottom chart - McClellan Index has changed the direction and is above EMA(59) & MA(100) suggesting more stocks are advancing while less stocks are declining for now.
On daily chart below, it is very clear that market remains in resistance zone and will require strong push to pass through it. More consolidation in this area will be beneficial for a meaningful rally later.
On weekly chart, we can see that every time market came into resistance zone, it was rejected. In next few weeks, we shall get a better picture as to whether this time will be any different!!!
As mentioned in earlier post, market appears to be in staging area. Typically this scenario happens when global/political outlook are uncertain and smart money is NOT sure where to bet their money. Market can remain in staging area for weeks/months, staging area can also be called as "range" and during such periods, we can get false breakouts or fake-outs. Also next week, US FED meeting outcome will be revealed which might impact the markets across the globe. Better be cautious during such periods especially for long term investments...
What does it mean for your Investments?
Market is near HIGHs and in resistance zone, be cautious for reversal...
What does it mean for your Investments?
- Mutual Funds - If invested in equity markets then stay invested be careful and watch out especially if market cannot hold current level for long. If invested in debt funds then just make sure to avoid any losses beyond 8-10%. It would be wise to stay in cash or liquid funds or CDs for now until we get a clear direction.
- Stocks - Only invest in strong patterns and DO NOT forget to have STOP LIMIT in place.
Market is near HIGHs and in resistance zone, be cautious for reversal...