Market has been on a BULL train for quite sometime and we had mentioned that whoever missed the train shall wait for the pullback. It appears that market has finally decided to give us that opportunity, ONLY time will tell...
Market is in pullback mode after a multi-month rally which is perfectly normal. It has potential to drop all the way to MA(200) area or even bit further. McClellan Index has been in pullback mode for quite sometime which is also normal during mega BULL phase.
Weekly Nifty chart does display divergence between RSI, MACD, PPO and Price suggesting a pullback ahead of time.
Below monthly chart is where we need to pay attention. Take a look at price action in circles. Every time we got a monthly pullback it was swift and market recovered in coming months only to make NEW HIGHs. This only happens during MEGA BULL phase and we were precisely waiting for such an event to occur in current market. Since the drop is fast, it tends to spook everyone which is the right moment to enter the market as it becomes low risk entry. Keep an eye on monthly chart.
If indeed if we get such a drop in October 2017 then no need to jump in the market immediately, wait for market to stabilize and form a swing low or bottom. This would be ideal time to identify stocks which can be potential BIG movers once the market resumes its MEGA BULL run.
Market in pullback, wait for low risk entry...
Market in pullback, wait for low risk entry...