A hard-money environment where conventional setups are tough to find and structural breakouts are absent.
Conservative swing portfolios should remain in cash, & start deploying pilot positions only if the watchlist shows some strength.
⦿ Bias: Bear
⦿ Trend: Sideways
⦿ Swing: Sideways
⦿ Momentum: Negative but improving
Bias → Bear
From a long-term perspective, we remain in a bear market.
Over the past month, more than 50% of stocks have remained below their 200-day simple moving average (SMA). Hence, we stay in a bear market.
Only about 28% of stocks are positioned above their 200-day simple moving average. This week's numbers are almost similar to last week's, and we remain well below the 50% mark.
When more than 50% of stocks go above their 200-day SMA, we will again enter a transitional market. If this percentage stays above 50 for a month, we will finally enter a bull market.
Trend → Sideways
The current market trend can be best described as sideways.
The 52-week Net New Highs have not remained consistently negative or positive for the past three days.
Over the past three days, most major indices have not stayed consistently above or below their 50-day moving averages. About 38% of all stocks have remained above their 50-day moving averages, but, favoring the bulls, the 50% breadth is above the 200% breadth.
The market will enter a confirmed uptrend only if the 52-week highs consistently stay above the 52-week lows, PLUS more than 50% of stocks remain above their 50-day moving averages.
Swing → Sideways
The market is in a sideways swing state.
The week started with a strong gap-up, and the MBI turned green, but thereafter each day had progressively lower 4.5R numbers, with the MBI eventually closing the week in the red.
Broad indices have not stayed consistently above or below their 10-day moving averages. Less than half of the stocks are trading above their 10-day moving averages, and, not favoring the bulls, the 10% breadth is below the 20% breadth.
Swing Confidence is 25, indicating that the portfolio can take only the minimum permissible open risk.
Momentum → Negative but improving
The overall market has negative but improving momentum, as the momentum score is below the zero line but above its 9-period moving average.
Power, energy, media, defence, infra & auto are the relatively stronger sectors at the moment, as they have positive & improving momentum. The momentum is still positive but worsening in Metals, PSUBanks & Oil/Gas.
IT & FMCG are having negative & worsening momentum.
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