Nifty

#119 Nifty Update: "Investors liquidate their position to buy Mangoes "

Mango season is here and i dont find any other strong reason fundamentally tht why we are seeing a sell-off in market. This may be due to the mango lovers gng for mango..hahahaha…But remember Maaza “haar mausam aam”?? ..So guys be in some liquid cash to buy at lower levels in coming months…Anyways coming to the point, it was a “Black Friday” as some may state for the investors on 4th of May. Many expertise  and analyst are of mood that market may bounce back from current levels but study of my technical analysis suggest that we are more biased on the downside for coming 2 expires. As i had mentioned about the descending triangle in last few months we ultimately got breakdown from neckline with Close that to a weekly and daily. Last friday’s close has made many technical analyst eyes wide open. Descending triangle is a bearish signal but this time it was formed after a rally and global markets were positive so we had expected triangle to give bullish breakout which it didnt. Yet WE HAVENT GOT CONFIRMATION of breakout but we can be biased on downside as per Triangle rule but we have seen all indicators turning negative last week. You may see on the daily chart as i have marked that there are 4 gaps which has been left in last rally. We may see atleast first 2 getting filled. But 4700 odd level is a strong downside tgt as its a formula tgt from triangle breakout an we also have the gaps around same level. But as per the retrenchment level 4900-4940 is a strong level for support so i am expecting minimum 4900 as the tgt on NIFTY. 
Stock Markets generally over the world tends to trade in a seasonal cycle which states that a bearish cycle from April-October and bullish from November- March. it generally means that we see a market low in April-October and high in November- March. That has exactly been the case in the markets this here. We saw a bull run upto march, April was consolidation and now month of MAY will lead to some downside unless a strong fundamental reason or some positive parliament outcome. But it does not mean we may see new low but we may witness bearish mood. 
What are positive for the Markets??
Surely there is some positiveness for the long term investors. As you could notice in the chart 100 SMA (red) has given a bullish crossover over 200 SMA (White) which is a buy signal but NIFTY is trading below that averages so be cautious. Fundamentally we have seen some outstanding results coming of domestically which is a good sign for industries. Notice that Consumer utility stocks are giving better result which is indeed the first sign of market recovering from the bottoms. In the US a article suggest that 98 out of 100 Metropolitan cities are witnessing a real estate boom as the finance and prices are at affordable rate then rent. So globally also we are witnessing a spark in household utility spending.  
Strategy:
Short players can go short with Stop loss of 5200
Long players: Long term investors buy 30% of the portfolio at 4900-4950 and rest at 4600 if that level breaks out on downside or at 5200 if we see a bounce back from 4900.

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