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13 Mar ’24 — Nifty breaks 2 support, goes bearish todayNifty Analysis - Stance Bearish⬇️ Recap from yesterday: “One thing is sure, the sudden price moves we are seeing right now are quite indicative of a massive shift in fundamentals. Technical Analysis cannot detect the directional impact this early, but it would be prudent to keep an eye out for any possible clues.” 4mts chart We got some action today on Nifty but not on BankNifty. Nifty broke 2 support levels namely 22295 and 22051 and pulled back from the 3rd support @ 21913. Whereas BankNifty did not break down. Can you believe that Nifty closed with a loss of 338 points whereas BankNifty closed only 301 points lower? Our stance on Nifty goes from Bullish to Bearish directly whereas for BankNifty we are still maintaining the neutral stance. The concept of support and resistance is so evident today, see the 3 encircled regions, the first one around the 22295 levels, 2nd one at the 22051 level, and then the 3rd one at 21913. The only time Nifty took a pause was at these marked zones. Today’s fall aligned with the news about the possible “froth” in the mid and small caps. If the BTFD people would be kind enough to pass on this opportunity, we could have a meaningful correction on our indices. In the long run, a correction is better and healthier. Tomorrow is expiry, and we hope Nifty re-enters the 21913 to 21491 neutral band. This is the same flat zone that held nifty from 15th Dec 2023 to 15th Feb 2024. I wouldn't really mind spending another month in this zone. The challenge would be the aspect of momentum. Both of us know the market is shorted by weak hands, strong hands could enter this space and push down 800 to 1000 points in a week, if that happens Nifty could even fall below 21491 opening up avenues for further outflows. Coming back to the “froth” aspect of the market, the first to fall will be the small and midcaps, but those moves are contagious. Large caps will be the last to fall and last to recover. 63mts chart
NSE:NIFTYShort
by viswaram
28 Feb ’24 — Nifty takes out 22051 support, quite unexpected ➡️Nifty Analysis - Stance Neutral ➡️ Recap from yesterday: “They need to take out the 22051 and 21913 support levels, which is only possible if we have a macro level bad news. Banks are the only sector that could give away such an opportunity. Already the FIIs are not so happy with the future prospects of the financial sector in India. A small trigger could set the ball rolling and before long it could become an avalanche.” 4mts chart Nifty did fall today and the trigger was a news/event. AMFI issued a circular to all the Trustees to “protect the interest of investors of small-cap and mid-cap schemes”. And then gave a 21 day window to disclose this instruction on the respective websites. Ideally, this shouldn't impact the large-cap companies, but since it did - we may have to reassess the total risk to SIP inflows and outflows. Coming back to technicals, Nifty50 fell 314 points today ~ 1.42%. The first pause Nifty50 had today was at the 22051 support level, from 10.59 to 14.15 this level was at play. Even though we got the 2nd leg of fall from 12.51 to 13.11 - the pullback ensured we retraced up to the 22051 erstwhile resistance. And guess what, Nifty had its next halt right at the 21913 support level. Literally saved by the bell. On the higher timeframe, today’s move negates the flag pattern and instead, we have a double top (M pattern). Since this M pattern’s both legs are sitting at 21913 - the priority should be higher than the bullish flag set earlier. If Nifty50 had broken the 21913 today, we would have changed the stance from bullish to bearish right away. Hence we are going with a neutral stance tomorrow and would immediately go bearish if we have a gap down opening or sustained trades below the 21913 after the opening hour. Since we have the monthly expiry tomorrow - there is no better day to go bearish. The options premium will go up and it should be an option sellers day tomorrow. 63mts chart
NSE:NIFTY
by viswaram
Q&A_ Is Adani group in a bubble?Namaste! Adani group is in a bubble, if I consider the following points. 1. Rs 400 to Rs 4000 in a matter of 2 years. This isn't a behaviour of a large-cap stock. 2. The Adani group companies have borrowed hugely. Just look at the debt to equity ratio of Adani companies:- Adani Enterprises: 1.31 Adani Ports: 1.04 Adani Transmissions: 3.16 Adani Total Gas: 0.45 Adani Power: 1.87 Adani Green: 7.70 Adani Wilmar: 0.40 Average debt to equity is 2.275. Debt to equity above 1 is bad. 3. The overleveraged companies will mostly hit hard in a scenario of a recession. The central banks will increase interest rates to fight inflation, which will increase cost of borrowing. Interest rate payments in the over-leveraged companies will keep eating their current as well as future profits. This profits is already decreased because of a recession. You and me (consumers) will spend less on goods and services due to high cost of living, which has already decreased the profit in most of the companies' pocket. 4. Coming recession: Inflation has crossed highest in 4 decades in USA and UK, 3 decades in India, etc. The central banks will keep increasing interest rates to stabilise their respective economies. 5. The political friendship:- The friendship between current ruling party and Adani has been stronger due to the give-and-take relationship in the past. This is one of the reasons why people and investors are betting hard on Adani companies. 6. What should retail people do: A: Stay away from Adani group companies. There are tons of good undervalued companies so why would anyone only want Adani group company? Just because of FOMO (fear of missing out)? then, it's harmful in the long term especially to retail people. You know, the big investors (institutions) has expertise and knowledge to manage their losing bets. But retail people has only option to sell it at a loss. Recession has not been reflected in the Indian stock market now, but the big investors (institutions) will be lowering their stakes in these risky companies once they see weakness. What do you think about this analysis, please let me know. Disclaimer: The analysis I've shared is based on my understanding and experience in the markets. The future can not be predicted only be forecasted based on higher probability of happening. Please do your own analysis and/or consult your financial advisor before trading or investing.
NSE:ADANIENT
by UnknownUnicorn7637383
3
Nifty weekly commentary by Kiran * Bubble rally* WEEK 20Hi friends, 2 months back itself I called this rally as bubble rally when nifty is still hovering around 12500. We are now in midst of it. I also called JERK for one day four weeks back. Exactly on December 21st there is crash of 3 percent. WHAT IS LEFT ON PLATE TO EAT in this rally. We will get one more Jerk in coming two weeks because of new strain of corona virus from USA. Grab that opportunity I will go with option 2 which is BUY AND HOLD. YOUR HUMBLE TRADER Kiran
NSE:NIFTYLong
by KiranSunku2016
4
Bubble of 2020 will burst by April 2021!All governments globally have been generous in providing decent amount of stimulus to their respective countries as compared to their GDP's. What makes me wonder is that even after such huge amount of stimulus many countries have shown flat GDP growth or economic contraction. What if these stimulus were not provided at first place? The economies and the global markets would die out of lack of liquidity. The stimulus just acted like a ventilator for dead global economies. The scary part is the recovery rally that we witnessed after 23rd March 2020 (bottom of crash) is actually a bubble as stock prices have increased whereas earnings of many stocks are still away from their previous highs resulting in crazy P/E ratios on index (i have never witnessed a PE ratio of 34 on Indian markets). This bubble shall burst as on ground in practical life consumer spending is less and many small businesses have shut down. Banks are at a huge risk of default (worst then 2007-2008). The interest rates are cheap and people are buying automobiles on huge loans out of their affordability. Things will start spiraling down to reality as central banks will increase interest rates soon and consumer spending through loans will also go down. Financially, next decade will be challenging. We will see another market crash by 12th April 2021 (max). The bull rally is short lived!
UShort
by StockMarketAnalysis13
4