Weekly Market Recap
Last week the market rallied opposite to my expectation, but this week market behaved more or less in line with my expectation as market declined continuously from Monday to Thursday except one day gain on Friday.
On a weekly basis, the Sensex ended with a net loss of 521 points, or 1.44% and settled at 35673, similarly, Nifty lost 183 points. or 1.68% to close at 10693.
Current Outlook
In addition to the fundamentals and technical analysis, it’s a state assembly election verdict on 11th December that will drive the market substantially on either side, although exit polls outcomes are not in favour of the market. At a time when Indian market is battling with global head winds, it is as much the vagary of the election outcomes as it is the poor technicals of the market. So far price remains in a trading range that is nearly two months long and 15% deep from high. I am taking it as a continuation patterns, which means that price has bounced-off sharply and consolidating at the mid of the range prior to resuming the down trend.
Once again on Friday, on positive day, the market breadth was quite negative and stocks making new lows are increasing on daily basis as compared to stocks making new highs. Hence. I maintained my negative stance on market, but provided election outcomes next week, we need to be alert for possible reversal caused by change in sentiment though temporary.
Conclusion
Being in a bear market, I have to assume that sooner or later we’re headed lower. However, in a week of election outcome, I would advise to take the positions through options, as the path market takes will probably prove to be wild and interesting. Hence, be alert.
I welcome any feedback you may have about the content of this article.
Plan your trade..!!; Be a Savvy Investor..!!
Pankaj