MarketQuadrant 26/2025
Weekly market outlook
We are observing improving momentum in an upswing within an uptrending bear market.
A hard-money environment with stock-specific follow throughs. Swing portfolios can stay invested, with trailing stop losses.
⦿ Bias: Bear market
⦿ Trend: Uptrend
⦿ Swing: Upswing
⦿ Momentum: Positive and improving
Bias → Bear Market
From a long-term perspective, we are still in a bear market.
Over 50% of stocks have remained below the 200-day simple moving average (SMA) for 25 weeks.
Following last week’s pullback, we are seeing a significant improvement, with approximately 44 percent of stocks now positioned above their 200-day simple moving average.
When the percentage of stocks above the 200-day SMA rises above 50, we will enter a bear-to-bull transitional phase; if it remains above 50 for at least a month, we will be in a bull market.
Trend → Uptrend
The market has been in an uptrend for the past seven weeks.
52-week Net New Highs have remained consistently positive for the past three days, and are relatively better than where they were last week. It’s noteworthy to see the new 52-week lows almost stalling out, while the new 52-week highs continue to improve. They need to improve further so that we can enter a stronger uptrend.
For the past three days, all major indices have consistently remained above their 50-day moving averages, and about 70% of stocks have stayed above their 50-day moving averages.
The trend will turn negative again if the 52-week highs go below the 52-week lows and more than 50% of stocks fall below their 50-day moving averages.
Swing → Upswing
After a brief downswing, the market is in an upswing now.
The MBI, which had a worsening stance last week, turned green again. The upswing was somewhat subdued, as 4.5R numbers exceeded 400 on multiple occasions, but never reached 1000. The upcoming week will determine whether the green MBI resumes with significant strength.
All broad indices remained consistently above their 10-day moving averages. More than 50% of stocks are trading above their 10-day moving averages, and, as is to be expected in an upswing, more stocks are above their 10-day moving average than their 20-day moving average.
Swing Confidence is at 75, indicating that the portfolio can maintain somewhat less than the maximum allowable open risk.
Momentum → Positive and improving
Most broad indices closed this week with a positive and improving momentum, as the momentum score stayed above the zero line and its 9-period moving average.
Most sectoral indices also exhibit positive and improving momentum, except the FMCG index, which has negative and worsening momentum. IT, Infra, Metal, Oil-Gas, and Auto are the top five indices regarding the momentum score.
Pumps, AMC, Cables, NBFC & Agrochem are notable custom indices with positive and improving momentum.
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