A hard-money environment with limited conventional breakout/pullback setups, many of which are close to their earnings release.
⦿ Bias: Bear
⦿ Trend: Uptrend
⦿ Swing: Upswing
⦿ Momentum: Positive but worsening
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.
About 41% of all stocks are positioned above their 200-day simple moving average. This week's numbers are better than those of last week's, but 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.
Indian markets have experienced three distinct bear phases since 2017: the Post-Euphoria Correction (31 months, 2018–2020), the Inflation & Rate Hike Pivot (16 months, 2022–2023), and the current Structural Bear (17+ months, Oct 2024–present). The current phase has already surpassed the 2022-23 correction, with less than 25% of stocks above their 200-day moving average.
Trend → Uptrend
The current market is in a confirmed uptrend.
The 52-week Net New Highs have remained consistently positive for the past three days. We are still in single digits, though.
Over the past three days, all broad indices stayed consistently above their 50-day moving averages. About 81% of all stocks have remained above their 50-day MAs.
The market will stay in a confirmed uptrend till the 52-week highs consistently stay above the 52-week lows, PLUS more than 50% of stocks remain consistently above their 50-day moving averages.
Swing → Upswing
The market is in a confirmed upswing.
The MBI stayed green throughout the week, with the 4.5R numbers peaking mid-week.
All broad indices are consistently above their 10-day MAs. About 73% of the stocks are trading above their 10-day moving averages.
Swing Confidence is 50, indicating that the portfolio can take half the maximum permissible open risk.
Momentum → Positive but worsening
The overall market has positive but worsening momentum, as the momentum score is above the zero line but below its 9-period moving average.
Chemicals & Pharma are the strongest indices at present. All other positive indices (Power/Energy, Defence, Capital market, Metal, Realty) are having worsening momentum, indicating that they are in one or the other stage of a pullback.
IT & Banks are the indices with negative & worsening momentum.
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