- Nifty back below MA(100) and MA(200) - Anytime Nifty dropping below MA(200) is NOT a good sign, also MA(100) is below MA(200) suggesting further downside is probable.
- McClellan Index well above EMA(59) - More stocks are advancing compared to declining in cumulative fashion which is a good sign, however lets not forget that price action dictates everything.
Remember, this is a game of probability and NO guarantees, hence it is wise to be prepared than be surprised.
What does it mean for our Investments?
- Mutual Funds - If still invested in equities then time to make decision and if you do decide to stay invested then be prepared to feel the pain. No reason to continue SIP at this pont. If in cash/ FDs/ liquid funds then stay on sidelines.
- Stocks - ONLY invest in strong patterns with good earnings guidance and DO NOT forget to have STOP LIMIT on open positions. When market is in correction, it will drag everything down with it. Check out our trade size calculator to manage your risk along with potential buy candidates watch list.
Market bears appear to be gaining, get out of the way...