Market managed to get above MA(100) and also above MA(200), however can this be sustained! Is this time really any different!!! Let's take a look at charts for any clues and guidance.
Watch two key things in below chart:
- Nifty is above MA(100) and MA(200) - suggests a possible turn around
- McClellan Index above EMA(59) - suggests more stocks are advancing than declining in cumulative manner
Key observations in below Nifty daily chart:
- As the market is rallying, it is in the resistance zone near 8000 area (shown by dotted line)
- RSI is showing divergence along with PPO
Weekly chart provides a better picture, this market is hitting against trend line resistance near 8000 area, however RSI and PPO are bullish as they have broken the down trend line.
Charts are suggesting that market is prone to a pullback or sideways action for next couple of weeks. The magnitude of this pullback will determine if the turn around is for real! Hence it is better to remain cautiously optimistic for now.
What does it mean for our Investments for now?
Try our Service -
Take a look at our service called "Quick Charts" which offers an easy visual way to look at daily and weekly charts of chosen stocks side-by-side. We hope it helps you in your research.
Market on verge of reversal stay cautiously optimistic...
What does it mean for our Investments for now?
- Mutual Funds - If still invested in equities then time to sit tight, as we are on the cusp of turn around. No need to rush to start SIP unless we get positive trend reversal sign. If in cash/ FDs/ liquid funds then it is wise to stay on sidelines until we get confirmation.
- 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.
Try our Service -
Take a look at our service called "Quick Charts" which offers an easy visual way to look at daily and weekly charts of chosen stocks side-by-side. We hope it helps you in your research.
Market on verge of reversal stay cautiously optimistic...