Medium Term Trend: 👈👉 Sideways (with Negative Bias)
Nifty @ 18000 - Sideways Trend /Negative Bias continues
Due to personal reasons and time constraints couldn't update the blog for last few months so apologies however going forward will try to update blog once a week atleast.
Market has been in a sideways trend for last few weeks and many traders are on the bullish side expecting markets to break above 19K and similarly there are many traders who feel market has seen a decent rally and is due for a healthy correction which could take Nifty to 16K levels. Market has been disappointing both sides and just trading in a narrow band between 18500-17500. Options premium (on both sides) are seeing time decay and buyers (calls as well puts) are bleeding slowly.
Now many feel market has been in sideways to negative trend for last couple of weeks however as per my analysis it seems markets are in sideways trend since Sep 25/26 ( since it hit a high of 17980 levels). Now even though market hit a new of 18500 after that, it still was part of consolidation only. Charts are indicating that market reached some sort of 'maturity' zone near around 18000 in Sep end itself. This flat trading and sharp whipsaws we are witnessing since then are part of this consolidation only.
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| Nifty Daily chart |
In the chart above can be seen that markets were at 18K levels on Sep 26 and even today markets are at same level. Also from 18500/18600 levels we saw a fall which lasted for ~9 days and brought Nifty to around 17600 levels ( ~ 1000 point fall). Now in last 10 days we have corrected the same by ~61.8% price wise which is raising the possibility of one more fall towards 17600 levels (or lower) in the days to come.
Good thing is ~7 weeks have already passed and markets are still trading near 18K only which rules out the chances of any major crash from here ( if any major crash had to come then it would have come by now) however it does not mean we cant fall a little more from here. A fall towards 17500/600 (or even a bit lower towards 17K) is very much possible in the current wave.
Historically speaking, we have seen markets spending 7-10 weeks in similar conditions undergoing consolidation & now that we have already spent ~7 weeks already then it is possible that we are nearing the end of this sideways consolidation. Having said this, like we mentioned above , its also possible that one final leg on the downside is pending & it could be sharper than what we have seen till now ( just to frustrate/scare away remaining buyers) and takes mkt towards/below 17500 levels.
Thats the view for now, if there is any change then will post the update in coming days.
Happy Trading!
