16 Aug 2024 — Change in Stance to Bullish, Nifty up 174pts, BankNifty flat | PostMortem & Weekly…
Nifty Stance Bullish ⬆️
Last week we discussed how Nifty was still in the bearish stronghold and then a break above 24389 was mandatory for a change in stance.
https://viswaram.com/09-aug-2024-nifty-down-334pts-makes-a-61-8-6834a6abbf4d
This week, Nifty not only broke the 24389 ~ 61.8% retracement level but went ahead and broke the 24525 ~ 78.6% level too. This double break has prompted me to go bullish, but there is one catch — BankNifty is still flat though. The momentum has come from the IT sector this time.
On Friday, 16th alone — we had an intraday rally of 359pts ~ 1.49%. I thought the Monkey Pox (mpox) news might weigh in and the markets may remain flattish, but the rally still continues to amuse me.
Regarding the mpox, I was quite worried about the below article from WHO. How many of you think we may have another round of lockdown? This time the public may turn against the government for ruining their livelihood and enforcing vaccine mandates. Markets are not pricing in this news yet, or the news has probably not reached the threshold to create panic. I also feel the US markets may react first and then us.
https://viswaram.com/09-aug-2024-nifty-down-334pts-makes-a-61-8-6834a6abbf4d
Nifty has managed to go up 174pts ~ 0.72% for this current week, the ATH is still 500pts away but the bullish momentum may help us close the gap. I personally feel we may not go higher than 24800 till the 22nd. Our stance is bullish.
BankNifty Stance Neutral ➡️
BankNifty gets an upgrade, but not to bullish but to neutral from bearish. We have managed to go up by 27pts ~ 0.05% in the current week, but this is after a dramatic fall and then a recovery. 82% of this recovery coming on Friday the 16th, i.e. 698pts out of 851.
BankNifty went down to 49654 a level that we last saw on 6th Aug, and then magically rebounded. I know the frustration of the bears to drive down the prices because I am one of them.
I am a bear not because I do not negate the belief in India’s growth story, but because of 2 important facts.
- The primary reason for the huge influx of money to stock markets was that the average business owners felt the capital markets were giving better returns than their own enterprises.
- People look at the order book and hope that there is someone else ready to buy the stock at a higher price and hence they are saved.
https://viswaram.com/09-aug-2024-nifty-down-334pts-makes-a-61-8-6834a6abbf4d
The news that LIC is ready to invest 130,000,000,000 in stock markets will definitely give courage to the average retail investor. All of them believe if they buy the shares of a company XYZ for Rs2000, the influx of more money will be forced to buy XYZ for a higher price and hence they are safe. For me that is froth.
The only reason the markets are going up even when the FIIs are not on a buying spree is due to the accidental courage the retail investors have got as they think the domestic institution is there to catch them.
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https://viswaram.com/09-aug-2024-nifty-down-334pts-makes-a-61-8-6834a6abbf4d