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SGX Nifty 19th Oct 2016
SGX Nifty / Nifty Futures bounced back in style today. After a low of 8505 yesterday Nifty was up almost by 170 points from that low. There are many traders and analyst who are not clear as to what is going on but we have said that volatility and choppy moves will be taking place and most of them might not be trade able so just focus on the main trend which as per our understanding is down and keep taking positions in the direction of the main trend. We once again reiterate that we do not see any significant upsides will sustain though from time to time sharp pullbacks will come which will actually end up just being counter trend moves and nothing more than that. Some people may call it the resumption of the up trend or the bull market but we do not see that as a possibility for now. The trend is on the downside and in any pullbacks which will keep coming due to the choppy wave nature we do not think buying must be done rather selling only must be done. As we have said that the final target of this move will end around 5872 spot Nifty level but that does not mean that pullback will not come. Pullbacks like the ones today will keep coming and forcing the weak hands out of the short trades but eventually when observed on larger time frame prices will keep trending lower and we do not see any upsides sustaining.
Once again we reiterate that markets will behave exactly like mercury retrograde period sharp counter trend moves will keep coming from time to time and keep creating false breakouts and that will only be with a simple motive to trap traders on the wrong side of the trend.
As far as investments go we are very clear that most of the stocks in the market do not offer any value to invest at current levels and the overall valuations are steep. Further we do not see any sharp rise in corporate earnings because of which the valuations could come down. In such a environment we do not recommend buying into stocks. As far as our recommendations go MSL, Ugar Sugar, Bajaj Hindustan and Renuka sugar remain a hold, with renuka and ugar being in accumulate phase. If you are trading or investing only on the basis of this post please use appropriate risk management and then only trade. We do not recommend over trading nor do we recommend leverage investing. Please manage your own risk and trade or invest.
Silver we remain bullish and on dips we recommend buying silver. We do not see any much downside for silver and we see silver price will start rallying fast towards our final target zone in the coming few days.
Good Trading To You!