#MarketUpdate - Engulfing

Hi all,

Though the inter market divergence was negated, as per today's morning update, Nifty, even after creating a Life high (marginally by just 0.80 points), consolidated the day in a small range without any major upside.

But in the closing hours, index gave off all the gains and ended up creating a solid red candle which depicts a Bearish pattern, Bearish Engulf... just near a prior resistance area, which even increases its significance

After the fall of around around 130 pts / more than a %, it settled near the support zone of 11600-640, which again becomes a crucial area to watch out for.

So, very Important support for Nifty would be near 11560-11630, sustaining below which, can mean a down move to the lower supports near 11520-11470-11400-11300.....

This fall was very much expected, especially after the last 3 days price actions. The price for all 3 days closed very near to open, creating a doji (indecisiveness) candle, 29th March (Hanging man), 1st April (shooting Star) and 2nd April another Hanging man, was clearly suggesting the upper hand of bears and that was the reason the the earlier post I expected a very limited upside further, before at least respecting these bearish sentiments once. 

However, markets has a funny way of showing you that you are wrong, hence any short trade should be taken below the key support mentioned above and that too with a strict stop loss slightly above the Life high. 

Cheers

Hrishi

#MarketUpdate - NIFTY, at Life high.... BUT . . .

Hi all,

Nifty created an all time high and hence the inter market divergence is negated.

Also, it did not break the low of bearish Shooting Star pattern near 11640-30 so no shorts initiated.

The upside might be capped on account of important event of General elections 2019 to be held in this and next month. The results would be out on 23rd May 2019 and till then one can expect a great amount of volatility in the markets.

Also, more importantly, Nifty has surged by more than 15% in past 5 months, and hence I believe, that the risk reward for Bulls is not favourable at the moment.

So traders, it's better to wait and watch for entering in to a trade.

Remember, lesser profits / No trade is always better than a Loss

Cheers

Hrishi

#MarketUpdate - CAUTION, Diversion Ahead.... Fool's Day fooling ???

Hi All,

First of all, wish you a very Happy New Financial Year 2019-20.... :)

Surprisingly, the falling window could not do its magic and Nifty, after taking support near the first support zone mentioned near 10300-310, closed handsomely above the downward gap near 10435-40. And after that there was no look back for Bulls as they took Nifty towards almost a 9 month high, not the life time though...

However, Sensex today crossed 39k mark for the first time ever and surpassed its earlier Life high of 38989.65 and created a new high near 39115.57.

Now, this raises serious concerns for bulls

Firstly, Sensex is the only index which created a life high, and all other major indices, i.e. Nifty, Mid cap, Small cap, etc did not surpass their respective highs. This phenomenon is called as a kind of Inter market (index) divergence which can prove to be very alarming. The only issue is this can continue for a period of time and taking a trade just based on this may not be a good idea...

However, importantly, Nifty which was up by almost a % (115 points), gave more than half of its gains and closed up by just 45 points, and in this bargain, both Nifty and Sensex both have created a Bearish pattern which looks similar to the Shooting Star / Gravestone Doji.

In a nutshell, today's low for the indices would be crucial to watch out for.

Hence very Important support for Nifty would be near 10560-10630, sustaining below which, can mean a down move to the lower supports near 10520-11470-11400-11300.....

However, though it's quit difficult for Mid and small call indices, but even if Nifty manages to surpass the previous high of 11760 levels, we can then say that the divergence didn't work and it may continue its northward journey.

So, the big question is, are the Bears fooling us on Fools day?

I feel, 10400-10300 levels are very crucial for bulls.....

Let the time decide, wait and watch for the aforesaid levels...

Cheers....

Hrishi