Nifty trend / Nifty prediction April 1st 19
Nifty trend today was bullish but there was some volatility during the trading day. As per my Nifty trend analysis / Nifty prediction, we feel that trend or the pullback move that started from 10000 levels is in mature stage and now Nifty will be facing some significant resistance areas in the coming few days. The combination of factors that are currently at play suggest that the upside won’t be sustained for a longer duration now and we see from various historical analysis that whenever we have had a combination of factors such as high PE valuations, time cycle resistances, price maturing, sentiment reaching euphoric levels and many other factors that we will not get into as of now however whenever we have seen a combination of these set of factors there always have been sharp reversals in the market and each and every single time in history the reversals have been very sharp so generally speaking Nifty has seen significant cuts however the mid and small cap segment and the broader markets have always been impacted much more than what the Nifty does and hence we are advising booking profits in portfolios.
Some of you may say that some stocks are rallying very sharply yes we do not deny that some stocks are rallying but keep in mind that this sort of phenomena occurs when the last stage of the up move is in progression. There are also many traders who are now talking about how the RBI will cut 0.50 Bps and markets will further move higher so the point is that we feel at best a 0.25 bps cut is in the price but we are not in the camp which feels that next week we will see a 0.50 bps and the important factor is that price as of now has already discounted a 0.25 bps rate cut by the RBI so all and all euphoric sentiment, hefty valuations, price chart reaching the target areas that we had estimated at around 10000 levels, time cycle resistance areas and many more factors put together don’t argue well for equity returns, however, keep in mind minor upsides could still come so keep that in mind but from an overall perspective the price as of today has factored in all the positives be it BJP or even the NDA winning an absolute majority in coming elections (which we feel will not be the case leading to a disappointment), be it the RBI rate cut or most of the positives are in the price as of now, in fact, some sectors seem to have even gone much beyond the priced in levels and some froth is visible in some of the names. Anyways coming back to the point watch out for a Nifty trend reversal the question is it happens now or in a few days but we don’t see markets sustaining higher for a longer duration of time now.
If you are only trading on the basis of this post please use your own risk management and then only trade. Please do not over trade and always keep your risk in check. Money is always made by buying cheap and selling expensive not the other way round as of now with the growth problems and many other factors some of which we have discussed in our previous updates we don’t see Nifty sustaining on the higher side there will be some select stocks where deep value is present and earnings have bottomed and they will do well despite any news flow or who comes to power in the upcoming elections but we don’t see the same for the broader market.
Good trading to you!