Will 23509-22840 act as support zone- Nifty is trading below 21 day EMA which is below 63 day EMA and has also broken below 200 day EMA
- Nifty has followed the 2-3-5 rule where it take 2 points to create a trend line... 3 to confirm and take the trade and on the 5th attempt it weakens and breaks the trend. The strength of the Support is reflected with fading green color.
- At current levels Nifty is is looking weak
- Markets are oversold (and can remain oversold and fall even further)
- however it is important to note, at current levels Nifty is also near levels which has played crucial role as resistance and support in past.
- 23509 and 22840 levels are crucial Fibo levels to watch out for
- from a 5 year horizon, Risk::Reward ratio looks reasonably favorable from Long term perspective especially on any dips, where the down side risk may be 5-7% and on the upside, it has the potential to give 12-13% CAGR over a 5 year period
Fundamentally speaking Nifty
- Price to Earning ratio is 21.02 (Above 24 is considered expensive and below 19 is considered value zone so at 21 can be considered Fairly valued)
- Dividend yield is 1.3 ( 0.8 is considered expensive and above 1.8 is considered extreme value)
- There is lot of News and Noise going around the world. Just sharing some insights and the way I am looking at market.
- Also on longer term time frame the 2-3-5 marked in weakening red colour suggests the next time we see Nifty around 26300 there is a higher probability of that resistance been broken.
Disclaimer:
- These are not buy or sell recommendations.
- I have been wrong in the past and it is very much possible that I can go wrong again in the future
- It is your hard earned money... treat it wisely
Long
