In an earlier post, a three-years weekly bar chart of Sensex was analysed to explain why the index is going through a bull market correction and not a trend reversal from a bull market to a bear market.
To get an even longer-term perspective, let us look at the 13-years weekly closing chart (courtesy:investing.com) of Nifty:
After touching the bear market low in 2009, Nifty has been trading within an upward-sloping channel.
In late 2010 and early 2015, the index faced strong resistances from the upper boundary of the channel and corrected down towards the lower boundary of the channel.
The corrective moves towards the lower boundary of the channel took about 12-14 months on each occasion.
In Jan '18, Nifty briefly breached the upper boundary of the channel but has corrected down into the channel.
If the pattern repeats - though there is no certainty that it will - the index can correct towards the lower boundary of the channel till Jan-Mar '19. In which case, the zone between 9000 & 9500 should act as a support zone.
To get an even longer-term perspective, let us look at the 13-years weekly closing chart (courtesy:investing.com) of Nifty:
After touching the bear market low in 2009, Nifty has been trading within an upward-sloping channel.
In late 2010 and early 2015, the index faced strong resistances from the upper boundary of the channel and corrected down towards the lower boundary of the channel.
The corrective moves towards the lower boundary of the channel took about 12-14 months on each occasion.
In Jan '18, Nifty briefly breached the upper boundary of the channel but has corrected down into the channel.
If the pattern repeats - though there is no certainty that it will - the index can correct towards the lower boundary of the channel till Jan-Mar '19. In which case, the zone between 9000 & 9500 should act as a support zone.
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