Weekly Market Recap
Nothing much has happened this week except that the sign of distribution appeared to be likely scenario last week seems to be diminish but not eventuated completely, the session on Friday proved that when Nifty in last trading hour off their highs and closed with margin gains of 22 points.
Although, Nifty ended the week on positive note with a gain of 58.35 points or .54% to settle at 10772, similarly, BSE Sensex added 234 points or .66% to close at 35657.
Current Outlook
After distribution there is high probability that the market will resolve downward, but I think market is waiting for impending earning season to decide next course of action that will decide whether the current formation is re-accumulation or distribution. As I mentioned in my previous blog, since break down below the middle of the rising trading channel in march 2018, Nifty has not been able to cross above the middle level of the channel, in fact it has been trading side-ways for almost last 8 weeks. This could have been the prelude for a more serious decline, but I think market has decided to look at impending earnings before deciding the direction.
Since last few weeks I have found it difficult to work up much enthusiasm for a bullish scenario, however, I can’t say that I have escaped this ennui, but I have to admit that I have got a pretty decent setup in few large cap stocks this week for taking out the all-time highs to form a double top on indices.
Conslusion
Nevertheless, the sign of beginning a new uptrend is minute and need veritable evidence, so it is usually best to wait for this resolution and the aftermath before going long aggressively. If there is some follow through on Monday until Friday, I’ll have a little more confidence in that outcome, but we have to be prepared for a fast fizzle out at or below overhead resistance.
I welcome any feedback you may have about the content of this article.
Be patient..!!; Be a Savvy Investor..!!
Pankaj