123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Investing---Finance >> View Article

Sigh Of Relief As Nifty Closes 4% Higher After Hitting Lower Circuit

Profile Picture
By Author: Marketsmith India
Total Articles: 35
Comment this article
Facebook ShareTwitter ShareGoogle+ ShareTwitter Share

Market Pulse: Downtrend

Weekly Market Review

Before we discuss the historic dramatic move of today’s session, let us first reiterate how the week went.

On Monday, after floundering for most of the day, markets recovered mildly in the last hour to close with still heavy losses on higher volume. Nifty pierced August 2019 lows and made a fresh 52-week low. Brent crude price has declined sharply to less than $35 per barrel with Russia and Saudi Arabia preferring volume over value strategy.

On Wednesday, Nifty attempted a brief relief rally but failed to hold gains. After opening higher, markets were volatile through the day, and closed flat. As Nifty closed briefly in the green and in the upper half of the day’s range, the action was considered as a day one of an attempted rally.

On Thursday, Nifty gapped lower and remained under heavy selling pressure through the day. After breaching 10,000, Nifty made a low of 9,509 and closed into the bottom quartile. Nifty undercut day one low of an attempted rally and made a new low. The count for an attempted rally was reset.

Today, market participants ...
... were expecting a big fall in the early trade after the U.S. and European markets tumbled and SGX Nifty slipped below 9,000. For the first time after the 2008 crash, Nifty was locked down to 10% circuit and trading was at a halt for 45 min. On the way down, Nifty made a multi-year low of 8,555. The pain was evenly distributed between sectors suggesting again that people are selling the market as a whole.

After the trading resumed, Nifty rebound more than 1,500 points from its low. A biggest intraday recovery was witnessed in the market. Today is day one of an attempted rally. From here on, we will look for indices to establish and hold today’s low for two days before looking for a follow-through day. Currently, Nifty is trading 15.5% and 14.5% below its 50-DMA (11,829) and 200-DMA (11,653), respectively.

We do not predict and decode stories. We will take what the market gives us and continue to monitor unfolding conditions. We continue to remain in a Downtrend and suggest a cautious approach until the general market conditions improve.

It is important to understand that the market selloff has been so sharp and deep that it is a reasonable possibility that we have a sharp bounce like that of today. One should not get deceived by these moves. Instead, wait for the market to show some strength. Sharp, V-shaped recoveries are generally not constructive because most stocks can be hampered by overhead supply issues and that can cause a repulse. We will continue to monitor quality ideas with rising relative strength lines and superior fundamentals that could be set up to buy when and if the market begins to stabilize.

Key News

Continue reading with a MarketSmith India Premium subscription.

Visit https://marketsmithindia.com to Read Detailed Reports including Stock Recommendations, Idea Lists, Evaluate Stocks etc.

Disclaimer: Information contained herein is not and should not be construed as an offer, solicitation, or recommendation to buy or sell securities. It is for educational purposes only.

More About the Author

Investment advisory product based on William O’Neil’s CAN SLIM method with model portfolio, pattern recognition, idea lists powered by institutional quality data

Total Views: 258Word Count: 513See All articles From Author

Add Comment

Investing / Finance Articles

1. The Investor Co - Trade With Confidence
Author: Taramalhotra

2. A Deep Dive Into The Leading Investment Banking Firms In Hyderabad
Author: Verity knowladge solutions

3. Can Foreigners Buy Property In Ajman?
Author: tarek

4. When Will Same Day Loans Online Be Paid Into My Bank Account?
Author: Jockey Ferguson is a financial adviser of Fast Pay

5. The Role Of Exclusive Solar Appointments In Accelerating The Solar Revolution
Author: Shan Tait

6. Wills Vs. Trusts: Key Insights For Effective Estate Planning
Author: Daniel Stewart

7. The Impact Of Financial Institutions Groups On Global Markets
Author: Verity knowladge solutions

8. How Property Investment Professionals Drive Long-term Wealth Creation
Author: Rick Lopez

9. Private Company Registration Bangalore | Company Incorporation
Author: mwseo

10. Ecommerce Loan With Overdraft Facility For Your Business
Author: Tarun

11. Does The Online Application Process For A Short Term Loans Require A Credit Check?
Author: Jockey Ferguson is a financial adviser of Fast Pay

12. The Impact Of Customer Reviews On Solar Appointment Leads
Author: Shan Tait

13. What Happens If You Don’t Use Insurance Money For Repairs?
Author: john

14. How To Earn Money Online Without Investment In Mobile?
Author: john

15. Is It A Good Idea To Give Money To Beggars?
Author: john

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: