Market has become very choppy in past two months, providing many whipsaws (false signals). What shall we expect going forward? Is this turn around sustainable!!!
What is below chart telling us?
- Nifty back above MA(100), however MA(100) appears to have crossed MA(200) - suggesting further caution
Daily Nifty chart below shows lot of choppiness in the market, however we can see that MA(50) has been offering support for last couple of times. Will this trend continue or fall apart? ONLY time will tell but for now as long as market remains above MA(50), benefit of doubt goes to BULLs.
Weekly chart is providing subtle clues but nothing decisive. MACD appears to be turning as PPO is above zero mark and RSI remains above 50 mark.
Charts are giving us mixed signals yet benefit of doubt goes to BULLs. But its better to remain cautious market can easily fall apart. As long as market remains above MA(50) line BULLs have a chance to turn around.
What does it mean for our Investments?
Market trying to turn around yet remain cautious...
What does it mean for our Investments?
- Mutual Funds - If still invested in equities then stay invested as market might be turning around. If in cash/ FDs/ liquid funds then the low risk entry was near MA(50), however the risk is elevated and one needs to be ready to pull the plug.
- 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.
Market trying to turn around yet remain cautious...