What clues can we find in below chart for a possible long term trend?
Look at box A -
- McClellan Index remains below EMA(59) and continues to drop
- Nifty remains above MA(100) and MA(200) and continues to make NEW HIGH
Look at box B -
- McClellan Index makes several attempts to cross EMA(59) but cannot succeed for almost 6 months
- Nifty displays having hard time to remain above MA(100) and eventually continues its bear trend
Look at box C -
- McClellan Index continues remains below EMA(59) so far
- Nifty displays having hard time to remain above MA(100)
So you be the judge and tell us under "comments" as to what is your take on this situation!!!
- Mutual Funds - At this juncture we have a choice to make. Either wait for signal confirmation meaning, Nifty fails to remain above MA(100) & MA(200) and then attempts for a bounce. OR be ready to exit as soon as Nifty generates SELL signal.
- Stocks - Be careful as stocks may not follow through on the breakout hence have tight STOP limit in place. It might be wise to take gains and remain in cash.
Market may appear to be in bullish channel but be careful...