Weekly Market Recap

It was indecisive, inconspicuous and truncated week for the market on the account of festivals celebration. Both major indices Sensex and Nifty spent the week in a narrow range and showed no directional bias.

The benchmark Sensex ended the week on flat note while gaining 146 points, or .42% before settle down at 35158, similarly, Nifty50 gained 32 points, or .31% to close at 10585.

Current Outlook

Last week both VIX (volatility index) and market breadth returned from their extreme negative levels, consequently we saw a nice bounce-off from lower levels or vice-a -versa. This week these indicators were predominantly indecisive or neutral while slightly negatively biased. Ideally, it’s a normal and welcome move; especially, when the market has witnessed a turmoil and wild swings in last few weeks, however, it is not apposite to consider that correction is utterly over and market will gradually move upwards.

Question arises, whether the last week ruckus rally will be hold or failed? There are some features on the charts that say to me that the latter could be the case which I would explain next week. I think, meanwhile it is pertinent to gravely and decorously analyse the market to find out the possible course of direction based on the delineation of the technical structure. In addition to this I have noted that there is ambiguity among large cap with in the same sector; few appears to be bottomed out, while some look like they may resume their downtrend. Hence, outlook is not vivid.

Conclusion

Two weeks ago I said that we have entered a bear market, I could be proven wrong about that, but, even if I am, I still don’t see that much upside potential. Next week may or may not the decisive, but we should expect some volatility. Hence, whatever positions you take never forget to keep a stop in place with nice reward-risk ratio.

Feedback, comment or questions are welcome.

Invest patiently..!; Be a Savvy Investor..!!

Pankaj