Nifty is trying to recover and currently capped by MA(50) line which could be acting as a resistance here. Will it break the resistance or continue with further correction!!!
Nifty is back above MA(100) line as can be seen from below chart. Typically, Nifty crossing MA(100) line upwards is considered BUY signal BUT remember McClellan index continues to drop. Mixed signals and confusing!!! If you have been reading past 2 weeks post then you probably know why!
On Nifty daily chart it is very clear that MA(50) line is acting as resistance for now. Most likely, expect Nifty to bounce around between MA(50) & MA(200) line for some time.
On weekly Nifty chart, it appears like nifty is holding on to gains made during the bounce last week.
As suggested earlier, we might be witnessing early stages of topping pattern. There is NO confirmed way to find this out and TOPs are only identified after the fact. Another possibility could be that this is normal market behavior and market continues to maintain its bullish character.
What does it mean for our Investments?
Market trying to recover from correction but stay cautious...
What does it mean for our Investments?
- Mutual Funds - Stay invested as market is NOT giving any clear signs of trend change, however opening new positions at this point could be risky hence stay put and have patience.
- Stocks - Invest in right patterns and have tight STOP LIMIT to protect gains/limit losses.
Market trying to recover from correction but stay cautious...