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: Downswing
⦿ Momentum: Positive & 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 35% 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 → Downswing
The market is in a downswing.
The week started in the red, followed by a mild upmove that led to the MBI turning green, but thereafter the action was weak, and the MBI eventually closed the week in the red.
Broad indices have not stayed consistently above or below their 10-day moving averages. Less than 1/3 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 0, indicating that the portfolio should not take any open risk.
Momentum → Positive & improving
The overall market has positive & improving momentum, as the momentum score is above the zero line and its 9-period moving average.
PSUBanks, power, energy, consumer durables, metals & PSE are the relatively stronger sectors at the moment, as they have positive & improving momentum.
The IT index is having negative & worsening momentum.
That’s all for this week. If you'd like to know when I publish something new, subscribe to my newsletter, and you'll receive the latest directly in your inbox.
Thank you Nitin . Stay blessed