Market is going up reaching previous high levels. What is in store for this week? A week of no trades, Holiday! Yes, a Holiday week. Of the 10 broad sectors, that the whole market is classified. Seven of them are having bearish divergence on the Weekly charts. The Three which are yet to have weakness are:
Basic Materials: This is the sector which had the best of bullishness in the current move up. This sector has just reached levels to retrace bearishness, but yet to end the bullish trend.
Consumer Services: The strongest of the sectors in the present market. This chart does not show any weakness. There is much steam left in the consumer services stocks. Most of them are already on the run. Titan shows highest strength. Indian Hotels is likely to retest previous highs. Jagran and TV18 are fresh buy candidates.
Financials: This sector went into sideways market before reaching bearish divergence. Now it has started the up move to complete the pending bearish divergence. The leaders of the sector, ICICI Bank and SBI Bank have resumed their final bullish run. ICICI above 950 and SBI above 2350 will confirm bearish formation.
Once a chart retraces bearish divergence on the higher timeframe, it is a signal to change direction, whereas without going down, market has turned up now. When a super strong signal doesn't pan out, it shows that something is fundamentally changing below the surface of the market. Once all the left over sectors too clear bearish divergence, the whole is headed for a strong bear move.
The strongest sector of today has 2 buy signals this week.
Jagran: Buy above 121.30 with a stop of 10 points.
TV 18: Buy above 78.65 with a stop of 5 points.
Hold positions till the sector index retraces bearish divergence.
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