#MarketUpdate - Bang Bang . . But is the worst over.. ? ? ?

Hey all,

After a sudden sell off at the opening itself, Nifty hit its 4th ever down circuit of 10% and was halted for 45 minutes. That 10 minute slaughter took Nifty to 8600 levels. Even after re-opening, it traded a bit in the negative territory, and created a low near 8550.

And then, as we checked yesterday, bounced back sharply from there to trade near 10k levels now. This, I guess is the biggest intraday pullback I ever saw in my market in past 16 years. 

A pull back of close to 1600 points from the lows of 8555 to the high of 10160.. Which is a roaring 18.7% jump ! ! !

Now, as suggested in my other post of yesterday in What To Do?, if any one has purchased anything on today or yesterday, would already be profit mostly, so enjoy and keep on holding for great returns.

A common question now would be why the markets pulled back so much.... And my answer is common... Buy the Rumour Sell the fact...

It is heard that the Finance Minister is likely to address the media at 3:00 PM now, and market grapevine suggests there could be announcement regarding the Yes Bank bailout package or / and probable fiscal stimulus (similar to what US did last night)..... 

As per me, prices are discounting these facts currently, and post a positive announcement (IF ANY), it might stabilize a bit. Notably, the VIX (Volatility index) had rallied up to almost 59%, which is even higher than the 2008 crisis, and surely, it needs to cool down...

On the higher side, the first resistance for Nifty would be near a big downward gap of 10040 to 10340, after pulling back sharply towards 10150, it has now corrected a but and is trading near 9980

Personal view - 

The way bulls have managed to come back in a style, today's low would be very crucial markets to decide the course of action for upcoming months / years. However, any further upside can only be possible if markets take out this high of 10160...

Also, based on the wave counts I reckoned, after rallying for a while, or consolidating till the resistances (if surpasses 10160...) near 10350-10500-10750-10840, I feel Nifty can still, potentially go down, and even lower than 8500... Time would only answer this eventually.

Also owing to the highest volatility, remember to trade with strict stops and targets.

Plan of actions for investors, please keep adding quality stocks with every 5 or 10% corrections.

For traders, the immediate term bias remains bullish, unless Nifty holds the recent lows...

Let us wait and watch for a trade set up, if it unfolds on the charts...

Till then...

Cheers

Hrishi.. 

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#MarketUpdate - Leee Bazaar, Nifty 9 Hajaar.... Ab kya Vichaar? (Advanced Technicals)

Hi all,

Everyone, connected to finance, right now would be thinking of a song,

Ye... Kya hua... Kaise hua... Kab hua....

Investors would singing, Kya hua, tera vaada... Ha ha ha...

Jokes apart... but, excuse me for the start, in case it did not go well with someone.. But after such a challenging time, thought to at least start the post, on a lighter note, as it is going to have some important / advance inputs to the best of my knowledge....

Let's get started and try to decode it for the upcoming time...

As posted earlier, thanks to the bearish pennant pattern, Nifty hit the target of 10k, honestly, in a very quick manner than I expected... Moreover, it also slipped by more than 5% below the targets and is currently trading near 9.5 k in India

Please also note, at the time of writing this, SGX is trading near 8.7k, down by more than 800 points from today's close...

Now... most important... What to expect going forward...

Looking at the monthly chart, one can notice 2 trend lines, 1st connecting lows of 2008 - 2013 (white), and other one connecting 2013 - 2016 bottoms (Yellow)

Please note that, both the trend lines are not confirmed ones and as they are long term, just a prediction that they might help bulls.

By looking at the SGX Nifty future, looks like 2nd yellow trend line would not hold.

However, the other white trend line coincides near a weekly support / demand zone of 9k to 9.2k, moreover, near the same mark, on daily and weekly chart, there is a small gap up opening (of March 2017) which also might act as support... We call it, Confluence of indicators... There is also a very small gap in Feb 2017 between 8783-8805.

Finally, based on my understanding of the Fibonacci retracements and the little knowledge I have about the Elliott Waves... Out of the larger move from 2252 (Oct 2008) to 12430 (January 2020), Nifty has already completed 23.6% correction of around 10k levels, and now the next pit stop would be near the next crucial mark of 38.2% around 8500 levels.

As per my understanding, for a healthy and sustainable upmove, the corrections usually halt near 38.2% (they can also be as deep as 50% or 61.8%, and 78.6% is the last resort, below which the entire up trend gets challenged, to an extent. But that may not be an option as such, as breaking 6357 will disturb the entire bullish wave count, and everything might go for toss then... even a time to worry for investors, may be)

Also, previous top of Mar 2015, and likely the support zone now, too, comes near the aforesaid range of 8900-9100, creating another confluence.

So, to sum it up...

I feel the area of 8450 on the lower side (a gap up of 13 points in Jan 2017) and 9100 on the higher side, should ideally offer a great amount of help for bulls going forward, and may make sense too, as after creating a low near 8570, SGX Nifty bounced back sharply to trade near 9k levels at the time of writing this post. Below that notable supports can only be near 7900-8000 and 7300 (being the 50% retracement marked above)

Most importantly, unlike all the steep falls in the past, including the 2008 crash, volumes are surprisingly decreasing for the current fall, making the case even more stronger for bulls...

So, let us see in the coming times, what's all in the offering for traders...

Cheers till then...

Hrishi

Nifty @ 9k.... WHAT TO DO? (Especially for beginners...)

Massacre..... Mayhem.... Bloodbaath....

Recently, As a market participant / an enthusiast... I m sure, you would have come across these words regarding the financial markets... They are spread either by them who know the inherent potential of markets or by someone with no interest or knowhow...

Those who are untouched with it.... well... Great... and You shouldn't be as such.....

This is going to be a lengthy post, mainly for those who feel shattered/devastated/exhausted/frightened/demotivated/ with this market move.... 

My advise to them... is... Just hold on....

And, I never say this, but looking at the current scenario and recent interactions with you all, 

request you to share it with those it may matter... if you find it useful 

So, from the life high of around 12.4k, Nifty has fallen to 9.5k,which is a fall of close to 20%... (at the time of writing this post, SGX Nifty is already trading near 8.6k levels)

Firstly... This is not the only time when markets are down more than 15-20%, earlier in 2008, 2011, 2016 and 2018 Nifty the same thing has happened...

In fact, in 2008, due to the global sub prime crisis, Nifty was down by almost 65% from the top, so relax... though this is not usual, it's not a massacre / mayhem.....

Now the next point is, why are we falling... So we are falling, along with the global indices which are down by almost the same magnitude... Reason being... a mix of Corona virus outbreak and global oil price war, coupled with domestic and global economic slowdown concerns....

Which means, it's not only India... like the fall of 2008, the entire globe is down by 12 to 30% approx

Is the fall over, where will it stop?

Honestly, as stated above, there were bigger falls, and we can't say...

(Will be posting my technical report soon, please click here. for the same) 

What's important here is to know is....

What usually happens after a fall of such a quantum...

Historically, since the last 15 odd years, for which I am following the Indian markets, it is observed, that after a fall of anything above 10-20%, on an average...

Next 1 year returns are ~ +30%
Next 2 year returns are ~ +50%
Next 3 year returns are ~ +65%
Next 5 year returns are ~ +100%

Source... Nifty Daily/Monthly data... anyone can check the major falls I stated above...

Just to give an instance...

Before the fall, in 2008 Nifty fell from 6.3k levels to 2.2k levels in Oct 2008..

But within 2 years, in 2010 November, Nifty was back at that level, which is almost a 300% rise...

Which means, be it a financial crisis, or any other type of crisis geo political, social, medical ,etc, Markets have always handled it, sooner or later....

So, now the big question is

What do we do now....

For seasoned traders, request you to refer to my other post

#MarketUpdate - Leee Bazaar, Nifty 9 Hajaar.... Ab kya Vichaar? (Advanced Technicals)

But for long term investors, like I have been saying umpteen number of times in my sessions, investing is Buy and Hold (the quality stuff, off course...)

Hence, this is a time to BUY or ADD On to the quality ...

For some of you, especially new entrants, this might really sound, idiotic/pathetic/illogical,

but trust me, you will thank me in 2030..... for sure...

Even if, anyone is not able to dare to buy right now, my suggestion is, at least DONT SELL, let the markets settle, which might take a few month or even this entire year, and then enter, but do not sell in panic....

I am not getting in to the specific stock selection, as it demands a bit of expertise... My advice to anyone is at least enter in to Index ETF, in a staggered manner (SIP)... (ETFs - NiftyBees, JuniorBees, M100, BankBees, PSU BankBees, Gold Bees (as a hedge)

I feel, and practice this... Usually, any 10% fall in the main index calls for averaging out for lowering the cost of purchase....

Ending up with a quote by Mr. Warren Buffet...

"Be fearful when others are greedy, and greedy when others are fearful"

This quote, is very famous and well known, even to the new entrants...

but trust me... very hard to Act upon....

This topic is never rending, and to know about more and detailed dimensions, you all have my contact details, feel free to revert....

Cheers

Hrishi....

#MarketUpdate - Nifty 10k....

Update - 12th March 9.30 AM - 

Target achieved @ 10k....



Update - 11th March 2020 3.30 PM

After respecting some positive cues from 15 mins and hourly charts, markets pulled back by almost 100 points on  Monday and could not be a part of the global roller coaster ride, thanks to the Oil prices, as we were closed yesterday.

With a due respect to the global cues today morning, Nifty rallied up by more than 100 points today as well, however, could not sustain the rise and finally closed the day flat, up by just 6 points. In the bargain, it has shown a kind of Bullish Counter attack pattern on daily charts, which would be confirmed only above 10550-60 levels, however, by looking at the turmoil world wide it is not advisable to go long with such a mild evidence.... (aggressive traders can take a chance of a long trade with lesser position sizing and strict stop losses)

Nonetheless it shows that the bottoms near 10300 will act as a crucial support for the time being and we can see a relief rally after a massive sell off of in past couple of weeks. Though the bias remains negative, 10300 levels should be watched carefully by the bears.

Resistances updated on the chart

Cheers

Hrishi....
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