Market has managed to stay near MA(200) so far. BUT will this rally continue or a pullback is in the cards!!!
Not much has changed in below chart.
As suspected, market experienced resistance near 8000 area and under going pullback, however it shall soon encounter MA(100) which might provide support. However, check out the visible divergences in RSI & PPO.
Weekly chart displays that market has two potential resistance shown by dotted line. However, RSI is not yet oversold hence market might try to make a marginal high above 8000 area before undergoing any meaningful pullback.
We expect market to undergo a meaningful pullback before any substantial rally, however there are two possible scenarios:
Remember, history often repeats itself just not in the exact identical manner.
Market appears to be in process of trend reversal...
- Market continues its current pullback and extends it anywhere between 7400 to 7200 area - this will certainly spook many market participants
- Market makes a marginal high above 8000 area extending it all the way up to 8200 area and then undergo a meaningful pullback extending it to all the way to 7400-7200 area - initial high would trap many market participants and the pullback will be a big surprise causing panic
Remember, history often repeats itself just not in the exact identical manner.
Market appears to be in process of trend reversal...