Market made a NEW HIGH during DIWALI but all those gains appear to be vanishing. Are we witnessing history repeating itself!!! Although it is too early to predict market moves but based on recent action, it is better to be cautious....
Not much has changed in below chart, Nifty is well above MA(100) & MA(200) while MA(200) still remains above MA(100). McClellan Index continues to remain above EMA(59) and MA(100) suggesting more stocks are advancing and less stocks are declining.
Clear rejection in resistance zone can be seen in below daily Nifty chart.
Check out the similarities in the past moves and current move. Next week will provide better picture of what to expect in near term.
What does it mean for our Investments?
Market near HIGH but could not break through resistance yet...
- Mutual Funds - If market drops below 6078 level then we shall most likely experience the repeat of earlier moves and market will be dragged into the wide range. It would be wise to exit equities and stay in CDs or liquid funds.
- Stocks - ONLY invest in very convincing strong patterns and DO NOT forget STOP LIMIT in place.
Market near HIGH but could not break through resistance yet...