Weekly Market Summary:
Market begun the week with another breakout to new, all-time high, but that turned into reversal on Tuesday. But not to worry, the decline only brought price back to the new high which continued to rise for the rest of the week.
Encouraging third-quarter results by blue-chip like HDFC bank, Kotak bank, ITC, HUL, and HCL-TECH added to the cheer.
In the week gone by, the 30-share Sensex surged to an all time high of 35511.58 by adding whopping 919.19 points. The 50-share Nifty settled by adding 213.45 points, at 10894.70.
Leadership came from IT and financials, while autos were on the flip-side.
Current Outlook:
As I wrote in my previous blog that next leg of rally would be fast and furious, so as happening like this only. Volatility Index (VIX) still in complacency zone, momentum on the back of strong earnings has accelerated, which suggest that market has enough room to go upside from here. I think we are in final phase of rally, but when will it stop, very difficult to say. Nevertheless, market seems to be overbought, but this term has no relevance as of now, every time minor dip turned out to be new all-time high.
Entering position in a raging bull market can be quite scary. Who wants to be the last buyer? But the action recently in the index perfectly illustrates how you can find trading gems in the market despite wildly overbought market conditions. We need to keep in mind that even as the market sells off, there’ll be pockets of strength. Those who are selling red hot sectors like auto and industry group will look to invest in areas of the market that are strong from an intermediate- to long term perspective, but not participating recently.
As I continue to maintain bullish stance on the market, hence I look to buy into areas that have pulled back recently to key support level.
Conclusion:
The reason for considering this rally to be final is because I can see on the chart is the ever-increasing angle of ascent of the price index. However, many individual stocks are on the verge to rally after having a descent correction. Hence stock selection would be a key to enter into the raging bull market.
For weeks I have been expressing concern about the selling discipline and push a stop loss button if needed, and again I am reminding you, always keep a stop in place.
You can write your comment or ask any query below here in comment section.
Enjoy the rally!! Be a Savvy Investor..!!
Pankaj