Nifty trend prediction today 28-1-19
Nifty trend today was all over the place.(There is some coding issue in the website so please do make sure to read scroll lower and read the entire update ) In the morning Nifty went higher and then moved lower. The were some stock specific accidents today in ZEE, DLF and even the front line stock Maruti. Regular readers of this website are well aware that we have been saying that earnings misses will keep coming and since we are now in a time cycle area where earnings bottoms are formed for the next 1-2 quarters we will keep seeing some terribly disastrous earnings which will make the stocks look very expensive at current levels and hence eventually with the current set up you will see stocks lower and hence we have been consistently advocating not to remain invested and get out and be on as much cash as possible. The advice to get out on cash still holds from a broader stock market investment perspective and keep in mind that the entire Indian stock market cannot be painted with the same brush and there are some select stocks where deep value is available but overall when we look at the broader market there is not much value stocks look very expensive and earnings not coming through will keep adding more pressure on them and eventually we will see most of the broader market lower from here how much lower is the question. Now some of you have asked me what if NDA comes back to power with a clear majority then what? The answer to that is that if that scenario plays out then yes we could see a bump up but eventually that will also turn out to be another lower top or some sort of topping formation that’s because at the end of the day there is no earnings delivery from a fundamental perspective and till the time you do not get earnings no matter what news flow comes stocks will be expensive and that eventually we seen that stocks don’t remain expensive for beyond a period in time and always there has been correction in prices whenever earnings have missed so the stock will adjust eventually it is only a matter of time.
Now based on my Nifty trend / Nifty prediction we see that Nifty continues to remain within the trading range of 10690-11000 and I do not see how this can be counted as a breakdown from the trading range. Few days back Nifty moved higher and everyone said it’s a breakout now 100 points lower and everyone is saying that this is a breakdown but I do not see anything changing till the time the range of 10690-11000 is taken out. Within the range up down moves will continue I am not suggesting that it will not and it could be volatile within the trading range I am not disputing that at all but eventually till the range does not break from a technical analysis standpoint there is no trade to be done. It is over important for a trader to learn that there are no good set ups then just leave the trade and wait for a good set up dont force a trade because whenever you do force a trade you generally end up on the losing side. As usual 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.
Good Trading to You !