Note : This is not a recommendation and I am not a registered analyst,
these are just data points and an assessment of the positives and negatives
from a longer term point of view (6-12 months).
Nifty Weekly
Chart 1. For the short term, it looks
a bit stretched with 2 consecutive weekly closes above the standard 20/2
Bollinger Bands. For more shorter-term risks, I am confident of drawing the
support band near 10080-120 but that seems far off. For now, keeping an eye out
on 10500 as short-term support. We are in all time high territory so basic
logic and common sense says uptrend intact on longer time-frame. The index is
still above its 40 week moving average and the slope of the average is also
upwards.
Chart 2 Nifty total returns/10 year Bond index ratio is above its 40-week MA &
momentum also favours Nifty index, indicating longer term outperformance for
Nifty vs bonds.
Chart 3 Longer term intermarket strength as per the RS matrix is in IT & Realty.
With Auto and Pharma at the bottom.
Chart
4 All
indices are above their 40-week MA.
Chart
5 Avg. & Median distance of all sectors from their 52-week closing high is
at -2.2% & -1.3%.
Chart 6 FII flows in Index futures segment is back to positive AND clients back to old habits of shorting the rally !
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