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Nifty Daily

12 May 2021 ‚óŹ 02:13 PM

LONG%

SHORT%

75%

25%

Position Sizing model - Long % = percentage of indicators bullish v/s Short % = number of indicators bearish, Including both daily and weekly time frames.

  NIFTY          
 TIME TREND Up Level   Down Level
 Short term trend Up 14980 14600

I have just one question, if the market is weak and in distribution mode then who is buying all the Smallcap and value stocks every day? When stocks fly every day it is often considered a sign of a bubbly market and the stocks flying include many that are not at all-time highs but breaking out of consolidation patterns. The nifty has become a dud because of the short-term troubles facing the market and what has worked is a stock-specific and sector-specific approach. This pattern is also seen in US equity markets which looking at the main indices might make you feel that everything is falling apart but sector indices like the DJT, DJUSBK, DJUSIM, or ETFs like XLI, XLF, XLM have outperformed. Money is rotating out of defensive sectors into cyclical and value stocks everywhere. The only difference is US financials are also doing well. Our Financials are knocked down by the pandemic.

Nifty may have bottomed today near the 20dma and the rising trendline from the 14150 bottom at 14650. The pattern could be developing as a triangle or is wave 2 of 5. What the Nifty does in its next attempt to breakout above 14,950 will tell us more about this.

The nifty came back to the rising trendline from the bottom but did not break it. Holding above 14,650 pressures should go back up towards the trendline of the highs at 14,945. A breakout above this line would take it towards the rising channel on top near 15,450. Failure to breakout would mean that prices remain on the trading range of a developing triangle pattern.

The swing declined again to 53. No trend is emerging.

  BANK NIFTY        
 TIME TREND  Up Level   Down Level
 Short term trend Up 33913 31906-31000

Bank nifty closed just above the 20 day moving average at 32,431. The daily momentum indicator crossed over to the sell-side raising the odds of a dip towards 31,600 if the 20dma breaks. For now, I think it should hold but bank nifty is not clear on the pattern so it is not a confident view.

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