Medium Term Trend: ↓Down (Changes to up above 10900)
Weakness Continues: Nifty opened up around 9300 levels however couldn't sustain the momentum. "sell on rise" emerged yet again and pushed nifty below 9000 levels. It closed at 8965 with a loss of 250 odd points.
Nifty once again dipped below 9k and today even managed a successful close below which is a bearish sign however that doesn't change our view (not yet). We continue to observe this area ( levels around 9K) as a significant support area and as mentioned numerous times in previous posts, at this level Nifty has achieved parity or equality with that of 2008 fall ( & also with 1993 & 2000 falls). So common sense dictates that we should be some sort of supporting coming in at these levels.
Nifty overall trend remains down, makes no mistake about it, however markets have turned way too oversold and a bounce from these levels is likely. We have already seen one bounce on Friday which took Nifty back above 10K levels however it didn't last and Nifty now has turned and moved below 9K once again. Now the question is was the bounce we saw on Friday was just a dead cant bounce and Nifty is now ready to resume its downtrend? It may be so but our view is that some part of the bounce could still be pending and as long as 8500 holds, Nifty can attempt another shot towards 10K levels.
Looking at the nature of fall from Fridays high of 10200 to 8965 today, its looking relatively slow & corrective in nature ( In comparison to the rise we had seen from 8500 to 10200 levels on Friday) which also suggest there is another leg pending on the upside which can take Nifty back to 10200 levels. One worrying sign is that VIX continue to rise and that is never a good sign for bulls for Nifty to make some upsides we should see some cooling off in VIX.
From investment perspective Nifty continue to offer good opportunities to accumlate good quality stocks at cheap prices. Today inspite of market falling 300 points some good stocks ended in +ve territory (which again suggests a change in market breadth & likely support at these levels).
Markets can be anything but predictable and whenever markets turn predicatable the trend usually changes ( even if its for short term). From trading perspective if Nifty manages to move above 9300-9400 levels tomorrow ( above todays high) then we can expect further upside but on the other hand if weakness continues tomorrow below 9K and market start spending too much time around 8500 then it wont be a good sign and the chances of market breaking below this level will increase.
Happy Trading!
Weakness Continues: Nifty opened up around 9300 levels however couldn't sustain the momentum. "sell on rise" emerged yet again and pushed nifty below 9000 levels. It closed at 8965 with a loss of 250 odd points.
Nifty once again dipped below 9k and today even managed a successful close below which is a bearish sign however that doesn't change our view (not yet). We continue to observe this area ( levels around 9K) as a significant support area and as mentioned numerous times in previous posts, at this level Nifty has achieved parity or equality with that of 2008 fall ( & also with 1993 & 2000 falls). So common sense dictates that we should be some sort of supporting coming in at these levels.
Nifty overall trend remains down, makes no mistake about it, however markets have turned way too oversold and a bounce from these levels is likely. We have already seen one bounce on Friday which took Nifty back above 10K levels however it didn't last and Nifty now has turned and moved below 9K once again. Now the question is was the bounce we saw on Friday was just a dead cant bounce and Nifty is now ready to resume its downtrend? It may be so but our view is that some part of the bounce could still be pending and as long as 8500 holds, Nifty can attempt another shot towards 10K levels.
Looking at the nature of fall from Fridays high of 10200 to 8965 today, its looking relatively slow & corrective in nature ( In comparison to the rise we had seen from 8500 to 10200 levels on Friday) which also suggest there is another leg pending on the upside which can take Nifty back to 10200 levels. One worrying sign is that VIX continue to rise and that is never a good sign for bulls for Nifty to make some upsides we should see some cooling off in VIX.
From investment perspective Nifty continue to offer good opportunities to accumlate good quality stocks at cheap prices. Today inspite of market falling 300 points some good stocks ended in +ve territory (which again suggests a change in market breadth & likely support at these levels).
Markets can be anything but predictable and whenever markets turn predicatable the trend usually changes ( even if its for short term). From trading perspective if Nifty manages to move above 9300-9400 levels tomorrow ( above todays high) then we can expect further upside but on the other hand if weakness continues tomorrow below 9K and market start spending too much time around 8500 then it wont be a good sign and the chances of market breaking below this level will increase.
Happy Trading!
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