Weekly Market Recap
This past week has been quite exceptional for the market as NIFTY achieved a new milestone of crossing above 20K mark and comfortably sustained above that. Despite mixed global clues, Indian markets outperformed their global peers by a wide margin and remained resilient throughout the week to close at the highest point.
In the week gone by the benchmark SENSEX surged 1239 points, or 1.86% to close at 67838, similarly, NIFTY gained 372 points, or 1.88% to close at an all-time 20192. While BANKNIFTY outperformed the other indices with a gain of 2.28% but fell short of a few points to attain the previous high.
Current Outlook
Well, I think we are in the throes of a different kind of market where the buying force has been ostentatiously strong; in hindsight, we can say every deep or minor correction has been a great buying opportunity. However, it wasn’t easy to buy in every pullback since the market has been quite overstretched for quite a long period of time. And certainly, the VIX at the decade low level provides complacency and at the same the sign of peril for a sharp and deep correction.
Now, again NIFTY has gained 1000 points from its recent correction and still looking strong. However, like in the recent past NIFTY is looking quite vulnerable on the long-term monthly chart which suggests a correction of some magnitude is on the card, but as I wrote above, we are in the throes of different kinds of market that makes it difficult to predict when the much-awaited correction will come.
Presently, the technical configuration seems to be good as whatever negative divergence momentum developed in the recent past has been resolved comfortably. Moreover, there are few large-cap stocks that are well configured and suggest a potential upside target. Hence, the outlook is cautiously positive.
Conclusion
Unimpeachably, the bulls are quite dominating the market and don’t seem to be in a hurry to leave that path, however, with every rise the risk is increasing exponentially, hence it is strongly recommended to put a tight stop.
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Be Disciplined; Be a Savvy Investor..!!
Pankaj