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Midcaps and Banks diverge from Nifty

26 Oct 2020 ‚óŹ 04:35 AM

Inter market divergences can precede market turns, till the divergence is broken and we get a lead signal from one of the markets to drive the other. So Nifty rallied to new highs above the August top but Midcaps did not follow. They should have. But now in the short term as the pink line shows the new highs in the Midcap index [and bank nifty] above the Oct 12 high have not been confirmed by the Nifty. This short term divergence is a negative divergence till we surpass 12022. This keeps open the near term risk of a correction in Nifty.

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