Silver’s breaking out of a multi-year consolidation?Silver’s breaking out of a multi-year consolidation? Sure, the charts are giving you that breakout signal—a classic rounding bottom pattern. It’s a textbook setup. But I’m telling you right now, don’t get pulled into the hype.
Silver isn’t your safe haven; that’s Gold’s job. When the world’s a mess, people don’t run to Silver. They run to Gold. Silver thrives when the global economy is expanding, when there’s industrial demand driving it. But let me remind you where we are: recession fears, global instability, geopolitical tensions. None of that screams “strong economy” to me.
You’re not betting on Silver breaking out of a chart pattern—you’re betting on a world that’s heading into turbulence. And the world today isn’t sending the message that industrial demand for Silver is going to boom anytime soon. So, unless you think we’re suddenly going to shake off all this uncertainty, you’re just gambling on hope.
Right now? The market doesn’t justify Silver. Gold is your shield when the storm hits. Silver? Not so much.
Recession
CNXIT BULLISH !
1. Resistance Breakout:
- The index has historically faced selling pressure at 38,653 - 38,405 Zone, causing it to reverse or pause its upward movement.
- When a stock breaks above a strong resistance level, it means that buying demand has overwhelmed the selling pressure at that price point. This breakout is a positive sign, indicating that the chart may move higher, especially if it is a clean break (i.e., it closes significantly above the resistance level).
- The **strength of the breakout** is often measured by the volume of trading activity. If the breakout occurs on **high volume*, it indicates that a large number of market participants are involved, adding credibility to the When a stock breaks through a strong resistance level and retests that level with good volume, it can signal a strong bullish move. Here's a detailed breakdown:
2. Retest of the Resistance Level:
- After the breakout, it’s common to see a retest of the previous resistance level, which now acts as a support level. This retest occurs as some traders may take profits, or there may be some temporary selling pressure as the market re-evaluates the new price.
- If the stock successfully holds above the previous resistance (now support) on the retest, it confirms that the breakout was valid. This gives bulls (buyers) more confidence that the level will hold and that the stock has further upside potential.
3. Volume Confirmation:
- A retest with good volume is essential. If the stock holds the new support on strong volume, it signals that buyers are stepping in to defend the level, further reinforcing the idea that the stock is in a bullish phase.
- Conversely, if the retest occurs on low volume, it may indicate a lack of conviction from buyers, and the breakout may be prone to failure.
4. Bullish Expectations:
- When a stock breaks out of resistance and successfully retests it with strong volume, the expectation is that the stock will enter a new bullish trend. The prior resistance has now been transformed into a solid base of support, and the stock may experience momentum buying, pushing prices higher.
- Traders often see this scenario as a low-risk, high-reward setup. Their stop-loss would typically be placed just below the new support level, while the upside target could be based on previous price patterns, such as Fibonacci extensions or previous highs.
5.Target :
- it is on its all-time high targets on fib zones,pivots 0r based on future price action basis.
# Summary:
- **Breakout of strong resistance Indicates potential for higher prices.
- **Retest of resistance as support Confirms strength of the move if support holds.
- **Good volume on retest: Adds confidence in the bullish move.
- **Bullish expectation Likely continuation of the upward trend.
This combination forms a high-probability bullish setup in technical analysis.
#cnxit #itsector #nifty
Recession Risks and Market CautionIn July 2022, we saw the yield curve (US 10-year Treasury vs the US 2-year Treasury) go negative. It’s been in that zone ever since, and now, as we approach the two-year mark, we’re on the brink of positive territory.
An inverted yield curve has a well-documented history of signalling recession. When you factor in the PMI readings dropping below 50, rising unemployment rates, and NASDAQ already in correction mode with a 10% drop from its peak, the message is clear.
So, what’s the takeaway? The indicators are pointing towards a potential recession and bear market. It’s wise to proceed with caution as these signals suggest we might be heading into choppy waters.
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.
EURUSD recovery remains unconvincing below 1.1040EURUSD extends recovery from the 200-DMA, as well as an upside break of a fortnight-old descending resistance line, as markets await the Eurozone inflation data and the Fed’s favorite inflation gauge, namely the US Core PCE Price Index. That said, the looming bull cross on the MACD and upbeat RSI (14), not overbought, also keep the Euro buyers hopeful. However, a clear run-up beyond the previous support line stretched from October 2022, now resistance around 1.1040, becomes necessary to confirm the bullish trend. Following that, the yearly high of 1.1275, marked earlier in the month, will be in the spotlight.
On the contrary, the two-week-long resistance-turned-support of around 1.0880 restricts the immediate downside of the EURUSD pair ahead of the 200-DMA level of 1.0810. In a case where the Euro pair drops below 1.0810, and also breaks the 1.0800 round figure, sellers can aim for May’s bottom of 1.0635 before targeting the yearly low marked in January surrounding 1.0480. It’s worth noting that the downside moves need strongly disappointing Eurozone HICP and CPI numbers, as well as an extremely positive US Core PCE Price Index, to reverse the latest uptrend.
Overall, EURUSD remains in the recovery mode as the key Eurozone and the US data loom.
USDJPY retreat appears doubtful beyond 137.30USDJPY remains on the way to posting the second consecutive weekly loss after reversing from the yearly top in the last week. In doing so, the Yen pair justifies the overbought RSI (14) line. However, a six-month-old horizontal support zone near 137.90-85 and the 200-DMA level surrounding 137.30 appear tough nuts to crack for the sellers to retake control. Following that, a gradual south-run toward the 61.8% Fibonacci retracement of its May-October 2022 upside, near 136.10 and then to the previous monthly low of around 133.50 can’t be ruled out.
On the contrary, USDJPY recovery needs validation from the yearly latest peak of 140.95, as well as the 141.00 round figure, to convince buyers. It’s worth noting that the 140.00 psychological magnet caps the immediate upside of the Yen pair whereas a convergence of the one-month-old upward-sloping resistance line and 38.2% Fibonacci retracement, near 142.15-20, can challenge the quote’s run-up beyond 141.00. In a case where the risk-barometer pair rises past 142.20, the late October 2022 low close to 145.10 will be in the spotlight.
Overall, USDJPY is likely to witness short-term selling pressure but the trend remains bullish until the quote stays beyond 137.30.
Investors' Holy Grail - The Business/Economic CycleThe business cycle describes how the economy expands and contracts over time. It is an upward and downward movement of the gross domestic product along with its long-term growth rate.
The business cycle consists of 6 phases/stages :
1. Expansion
2. Peak
3. Recession
4. Depression
5. Trough
6. Recovery
1) Expansion :
Sectors Affected: Technology, Consumer discretion
Expansion is the first stage of the business cycle. The economy moves slowly upward, and the cycle begins.
The government strengthens the economy:
Lowering taxes
Boost in spending.
- When the growth slows, the central bank reduces rates to encourage businesses to borrow.
- As the economy expands, economic indicators are likely to show positive signals, such as employment, income, wages, profits, demand, and supply.
- A rise in employment increases consumer confidence increasing activity in the housing markets, and growth turns positive. A high level of demand and insufficient supply lead to an increase in the price of production. Investors take a loan with high rates to fill the demand pressure. This process continues until the economy becomes favorable for expansion.
2) Peak :
Sector Affected : Financial, energy, materials
- The second stage of the business cycle is the peak which shows the maximum growth of the economy. Identifying the end point of an expansion is the most complex task because it can last for serval years.
- This phase shows a reduction in unemployment rates. The market continues its positive outlook. During expansion, the central bank looks for signs of building price pressures, and increased rates can contribute to this peak. The central bank also tries to protect the economy against inflation in this stage.
- Since employment rates, income, wages, profits, demand & supply are already high, there is no further increase.
- The investor will produce more and more to fill the demand pressure. Thus, the investment and product will become expensive. At this time point, the investor will not get a return due to inflation. Prices are way higher for buyers to buy. From this situation, a recession takes place. The economy reverses from this stage.
3) Recession :
Sector Affected : Utilities, healthcare, consumer staples
- Two consecutive quarters of back-to-back declines in gross domestic product constitute a recession.
- The recession is followed by a peak phase. In this phase economic indicators start melting down. The demand for the goods decreased due to expensive prices. Supply will keep increasing, and on the other hand, demand will begin to decline. That causes an "excess of supply" and will lead to falling in prices.
4) Depression :
- In more prolonged downturns, the economy enters into a depression phase. The period of malaise is called depression. Depression doesn't happen often, but when they do, there seems to be no amount of policy stimulus that can lift consumers and businesses out of their slumps. When The economy is declining and falling below steady growth, this stage is called depression.
- Consumers don't borrow or spend because they are pessimistic about the economic outlook. As the central bank cuts interest rates, loans become cheap, but businesses fail to take advantage of loans because they can't see a clear picture of when demand will start picking up. There will be less demand for loans. The business ends up sitting on inventories & pare back production, which they already produced.
- Companies lay off more and more employees, and the unemployment rate soars and confidence flatters.
5) Trough :
- When economic growth becomes negative, the outlook looks hopeless. Further decline in demand and supply of goods and services will lead to more fall in prices.
- It shows the maximum negative situation as the economy reached its lowest point. All economic indicators will be worse. Ex. The highest rate of unemployment, and No demand for goods and services(lowest), etc. After the completion, good time starts with the recovery phase.
6) Recovery :
Affected sectors: Industrials, materials, real estate
- As a result of low prices, the economy begins to rebound from a negative growth rate, and demand and production are both starting to increase.
- Companies stop shedding employees and start finding to meet the current level of demand. As a result, they are compelled to hire. As the months pass, the economy is once in expansion.
- The business cycle is important because investors attempt to concentrate their investments on those that are expected to do well at a certain time of the cycle.
- Government and the central bank also take action to establish a healthy economy. The government will increase expenditure and also take steps to increase production.
After the recovery phases, the economy again enters the expansion phase.
Safe heaven/Defensive Stocks - It maintains or anticipates its values over the crisis, then does well. We can even expect good returns in these asset classes. Ex. utilities, health care, consumer staples, etc. ("WE WILL DISCUSS MORE IN OUR UPCOMING ARTICLE DUE TO ARTICLE LENGTH.")
It's a depression condition for me that I couldn't complete my discussion after spending many days in writing this article. However, I will upload the second part of this article that will help investors and traders in real life. This article took me a long time to write. I'm not expecting likes or followers, but I hope you will read it.
Have a great day :)
@Money_Dictators
Gold fades upside momentum within rising wedgeGold price eyes the first weekly loss in three as it retreats inside a 15-week-old rising wedge. However, the 21-day EMA adds strength to the $2,008 support, a break of which will confirm the bearish chart pattern suggesting a theoretical fall toward $1,750. That said, the $2,000 psychological magnet will precede the multiple lows marked near $1,970 and February’s peak of around $1,960 to act as an intermediate halt ahead of the aforementioned theoretical target of the wedge. It should be noted that the year-to-date bottom of around $1,810 may offer an extra filter towards the south.
On the contrary, Gold price recovery may initially aim for $2,050 ahead of challenging the stated wedge’s top line surrounding $2,075. In a case where the XAUUSD bulls defy the bearish chart formation by crossing the $2,075 hurdle, the recently flashed all-time high of around $2,080 and the $2,100 will be in the spotlight.
Overall, the Gold buyers appear to run out of steam and the rising wedge teases the bears. However, the downside appears challenging and has multiple speed-breakers, including the mixed signals flashed by the RSI (14) line and MACD signals.
Nifty IT= THE SECTOR TO AVOID FOR INVESTORS!⚠️FIRST THE TECHNICAL VIEW
Attached: Nifty IT Index Weekly Chart as of 13th April 2023
In the Chart above, I have mapped out the Potential Elliot Wave Count to play out over the coming Months:
- Price has fallen in 3 Waves which is our Larger A Wave
- Then Price did a Corrective bounce in an ABCDE structure making up our Larger B Wave
- And now the Larger C Wave Down in the form of an Impulse is about to start/ has already started!
I have 2 Downside Targets🎯 based on the Elliot Wave Count:
T1= 23400 to 22700 (which is C = 0.618 of A)
T2= 18350 to 17750 (which is C = A)
This implies an approx. 19% decline📉 for Target 1 and a 36% decline📉 for Target 2, from Current Market Price😨
NOW, THE FUNDAMENTAL VIEW
Regarding IT Stocks from an Investor's Stand Point, it is going to be the DIRTY FISH💩🐟 of the Pond and can potentially Spoil the Whole Pond as well
Irrespective of whether it is a Bull Market or a Bear Market for Broad Market Stocks.
IT Index is set for New Lows and Infosys is Leading it on the Downside
As an Analogy for the Indian Market:
Remember how Auto Sector was in 2018? TOP out
how Pharma was in 2015? TOP out
IT is the same now in a Bear Market🐻🩸. Fundamental Reasons:
- US Recession
- Wage Inflation (IT Co. main cost is Employees), Lay Offs, Etc.
- De Dollarization (aka USD Crash hurts Dollar Revenue of these IT Companies)
I suggest if you have any Investments in IT Stocks Sell Them Off✅
You will get better Value in Other Sectors✅
This is a SECTOR SPECIFIC View for INVESTORS!⚠️
Gold buyers run out of steam before final dose of US dataGold price seesaws near the highest levels since March 2022 inside a one-month-old bullish channel. The bullion recently makes rounds to the upper line of the stated bullish formation amid overbought RSI (14), which in turn suggests that the buyers are running out of steam and a pullback is in the offing. The same highlights the 61.8% Fibonacci Expansion (FE) level of the metal’s moves between March 22 and April 10, around HKEX:2 ,041, as the immediate support. Following that, the previous weekly top surrounding HKEX:2 ,031 and the HKEX:2 ,000 round figure could lure the XAUUSD bears. It’s worth noting, however, that a convergence of the 100-EMA and the aforementioned channel’s lower line, close to HKEX:1 ,980-78, as the key support to watch during the quote’s further downside. Above all, the metal’s bearish trend remains elusive unless it trades beyond the 200-EMA level surrounding HKEX:1 ,947.
On the contrary, a successful upside break of the HKEX:2 ,050 defies the expectations of witnessing a pullback in the Gold price. Even so, the 78.6% FE level of around HKEX:2 ,057 can test the bulls before directing them to the previous yearly high of near HKEX:2 ,070. In a case where the bullion remains firmer past HKEX:2 ,070, the record high of HKEX:2 ,075, marked in 2020, will precede the 100% FE level of HKEX:2 ,078 to act as the final defense of the short-term sellers prior to propelling the quote towards the HKEX:2 ,100 round figure.
Overall, Gold price appears to have had enough of a run-up in the week and may witness a retreat. In doing so, the lower high on RSI and higher high of prices, known as bearish divergence, may play its role, if not the US Dollar.
Gold buyers run out of fuel ahead of US NFPBe it the Doji candlestick just beneath the 10-week-old ascending resistance line or the overbought RSI (14), Gold Price flashes clear signs of bullish exhaustion. The bears, however, need validation from the monthly support line, close to $1,981, as well as the US Nonfarm Payrolls (NFP). Also acting as the downside filter is February’s high of around $1,960 and the late March swing low of around $1,938. Following that, the metal’s south run towards the 100-DMA and the 200-DMA, respectively near $1,861 and $1,787, can’t be ruled out.
Meanwhile, Gold price recovery needs a successful break of the aforementioned multi-day-old resistance line, close to $2,035. In a case where the bullion manages to cross the $2,035 hurdle and gains support from downbeat US employment numbers, its run-up towards the previous yearly high surrounding $2,070 can’t be ruled out. Should the quote remains strong past $2,070, the record high marked in 2020 around $2,075 appears the last defense of the bears.
Overall, Gold losses bullish momentum ahead of the key event, suggesting a notable pullback in prices should the scheduled US employment numbers trigger the US Dollar run-up.
EURUSD eases on the way to refresh 2023 highEURUSD extends the previous day’s pullback from a seven-week-old ascending resistance line as it pares the weekly gains, the third consecutive one. While the overbought RSI joined the stated resistance line to recall sellers, bullish MACD signals and a two-week-old ascending trend line, around 1.0820, challenge the Euro bears. Following that, the 100-SMA and 200-SMA, respectively around 1.0785 and 1.0700 could lure the pair sellers.
On the contrary, the aforementioned resistance line near 1.0980 acts as an immediate upside hurdle before directing EURUSD buyers toward the current Year-To-Date high, near 1.1035. In a case where the Euro bulls keep the reins past 1.1035, the January 2022 bottom surrounding 1.1120 will be in focus. During the quote’s advances past 1.1120, tops marked during the late March of the last year can probe the buyers near 1.1185 and 1.1235.
Overall, EURUSD is well-set for a fresh yearly top even if the bulls are hesitant of late.
TVS MotorTVS motors leading automobile company as we are seeing some demand in 2wheelers electric model here TVS motors making a Tripple top i.e Head and Shoulder pattern and stock was previously forming the pole and flag treated as channel formation the stock breaks downward and move towards the selling side now in 1day time frame it can go for further sell-side below the closing of 985.
What is a Triple Top pattern?
Triple top is a bearish pattern
A triple top or triple peak is a bearish chart pattern. It is very dependable in stock chart patterns used in technical analysis. It is straightforwadefined by three clear peaks formingat form about the same level in the market. This pattern is a specific form of the head and shoulders pattern. Just that the three peaks top around the same price levels the same way the double top does.
The first peak in this chart pattern is made when the prices fall back after a trending period in the market. Prices rise again to the same level as the first peak but buyers will not get sufficient momentum to drive prices up through the resistance. The third peak forms in the same way.
There’s a chance that prices can fall short or go beyond the previous highs, as long as they all top at the same price levels. No matter what happens, every peak has to be on a decreasing volume.
WIPRO ShortWipro is continuously in downfall and holding the support of level 385.
Now, it created a pattern of " head and shoulder " we may see a good fall if it closes below the bottom of the previous low of the pattern.
The share faced rejection of 50DMA and closed below it again.
Fib Retracement - Putting the Fib from the Corona time low we came to know the level of 0.618 is at 383 and that's where Wipro had taken supports if that breaks we can shorts position.
PVR gonna FallPVR stock price is in it's long term supply zone!! Any time sellers will enter and push the price down aggressively.
Guide to Recession - What Is It? Recession is a scary word for any country An economic recession occurs when the economy shrinks. During recessions, even businesses close their doors. Even an individual can see these things with his own eyes:
1. People lose their jobs
2. Investment lose their value
3. Business suffers losses
Note: The recession is part of an economic cycle.
If you haven't read that article, you can check it below:
What is the Recession?
Two consecutive quarters of back-to-back declines in gross domestic product constitute a recession. The recession is followed by the peak phase. Even if a recession lasts only a few months, the economy will not reach its peak after serval years when it ends.
Effect on supply & Demand - The demand for goods decreased due to expensive prices. Supply will keep increasing, and on the other hand, demand will begin to decline. That causes an "excess of supply" and will lead to falling in prices.
A recession usually lasts for a short period, but it can be painful. Every recession has a different cause, but they have the main reason for the cause of the recession.
What is depression? - A deep recession that persists for a long time eventually leads to depression.
During a recession, the inflation rate goes down.
How to avoid recession?
1. Monetary Policy
- Cut interest rates
- Quantitative easing
- helicopter money
2: Fiscal policy
- Tax Cut
- Higher government spending
3: higher inflation target
4: Financial stability
Unemployment :
We know that companies are healthy in expansion, but there is a saying, "too much of anything can be good for nothing."
During peak,
The company is unable to earn the next marginal dollar.
Companies are taking more risk and debt to reset the growth
Not only companies but investors and debtors also invest in risky assets.
Why does lay-off occur?
After the peak phase, companies are unable to earn the next marginal dollar. Now, the business is no more profitable. CCompaniesstart to reduce their costs to enter into a profitable system. For example - Labour
Now, Companies are working with fewer employees. Fewer employees must work more efficiently. Otherwise, they may be lay-off by the company too. You can imagine the workload and pressure.
You may argue that they should leave the company! Really? Guys, we just discussed the employment rate declines. How will you get a job when there is no job? Now, you get it!
Let's assume the effects of the recession on the common man:
Condition 1: He may be laid off.
Condition 2: Perhaps he will be forced to work longer hours. The company is unable to maintain a positive outlook. Fewer employees are doing more work due to massive lay-off. His wages decline, and he has no disposable income.
As a result, consumption rates are reduced, resulting in lower inflation rates. A slowdown in the economy is caused by lower prices, which decrease profits, resulting in more job cuts.
Four Causes of Recession:
1. Economic Shocks
2. Loss of Consumer
3. High-interest rates
4. Sudden stock market crash
1) Economic shocks - When there is an external or economic shock the country faces. For example, COVID-19,
2) Consumer confidence - Negative perception about the economy and the company from consumers who lack confidence in their spending power. Instead of spending, they will choose to save money. As there is no spending, there is no demand for goods and services. The absence of spending results in a lack of demand for goods and services.
3) High-interest rates - High-interest rates will reduce spending. Loans are expensive, so few people take them out. Consumer spending, auto sales, and the housing market will be affected. There can be no good demand if there is no lending. There will be a decline in production.
4) Sudden stock market crash - evade people's trust in the stock market. As a result, they do recall their money and emotion drives them crazy. It can also be considered a psychological factor. As a result, people will not spend money and GDP will decline.
Consumer Spending:
During the recession, consumers don’t have additional income called disposable income.
Consumer spending parts
-- Durable goods - Lasts for more than one year
-- Non-durable goods - Lasts for less than one year
-- Service - Accounting, legal, massage services, etc
Durable goods surfer during the recession. Non-durable goods are recession-proof because their day-to-day fundamentals are not affected by recessions.
Let's take an example of two stocks,
ABC Food vs ABC car
But, will you stop buying food because of the recession? Will you reduce your consumption of toothpaste, bread, and milk?
The answer is "NO".
Consumers buy the same amount of food in good or bad times, On the other hand, consumers only trade in or trade off their car purchase when they are not only employed but optimistic about the safety of their jobs & confident that they could get a promotion or a high paid job with another employer. And People's disposable income is absorbed during the recession.
Consumer spending is the crucial point to displacing recession.
Auto sales:
As we discussed, few people buy cars during a recession. New car sales count as economic growth. You may have heard about 0% loans. The company facilitates a 0% loan to increase auto sales. Mostly, people repair their cars or buy old cars during the recession.
You may see a boost in the used car market and spare parts selling companies’ sales.
Home sales/housing markets:
I have a question now!
Which is your biggest asset? Most of you will say, my home!
New home sales are part of economic growth. Also, house price impact how wealthy consumer feel. Higher the home prices, the more they feel rich, and vice versa. When home prices are higher, consumers feel they are wealthy and they are willing to spend. But when house price declines, they reduce spending/consumption.
If your biggest asset price declines, you don’t spend and the economy takes a longer time to recover. A higher rate stops increasing the home price because they have to pay more EMI. central bank reduces rates during the recession, and the housing market rate boosts because the loan/EMI is cheap.
Interest rates:
Generally, interest rates decline during a recession. Central banks cut interest rates that’s why loans become cheap.
Benefits of Lower interest rates -
- - Boost in the housing market.
- - Increase sales of durable goods
- - Boost in business investment
- - Bonds and interest rates have an inverse relationship. An economic downturn tends to bring investors to bonds rather than stocks, which can perform well in a recession.
- - During the recession, interest rates are lower and banks highers the criteria for getting loans, so that people can face the abstracts while lending money.
Stock Market:
I want to clarify that, the stock market is not an economy. The economic cycle is lagging behind the market cycle and sentiment cycle. It gives me a chill as a technical analyst and a sad moment as an economics lover. Sometimes it's ahead, and sometimes it's behind. Recession = bear market .
Recession-Proof Industries:
* Consumer staples
* Guilty pleasures
* Utilities
* Healthcare
* Information technology
* Education
I will write about this in the future, but for the time being, let's get back to technical analysis .
Market Recession indication - for education purpose only.Alert and Caution:
Crude oil broke its low level 6240 (INR) .. heading to reach low 4700 (INR) levels before 26th Dec 2022. Indicating recession phase started in sluggish Industrial and Manufacturing sectors,,, Indicating No demand for New Products due to Global Inflation impact.
All global markets will follow downward move along with Crude Oil fall till end of this year i.e., 26th Dec 2022.
Disclaimer: this information is shared for education and analysis only not for trading
JUBILANT FOODWORKSJUBILANT FOODWORKS is consolidating between the levels of 570 to 545 the moment it breaks down the consolidation zone we can see a good fall till 528 as there can be a small hurdle. The further target we are getting is till 500.
500 is good support where it saw the support and reversed back with a double bottom pattern. which also completed the Tripple bottom pattern and then consolidated between 545 to 570. That makes it the most important level to break down .
Another point is that while putting the FIB retracement we can see that the 0.5% rejection level is at the same 545 level and 0.6% is at 526. Because of this, we can see a slow bearish move (DEPENDING UPON THE VOLUME).
We can see pressure building up when moving average of 50 and 100 are crossed that show a negative sign in the market and we can see the breakdown on that point too.