FIIs
were net buyers of equity on Mon. May 11, but net sellers during the next four days. Their total net selling was worth a Rs 59.51 Billion. DIIs
were net sellers of equity on Mon.. and Tue., but net buyers on the next three trading days. Their total net buying was
worth Rs 10.75 Billion, as per provisional figures.
India's factory output contracted a record 16.7% in Mar '20 (thanks to the lockdown) against an expansion of 4.62% in Feb '20. For FY 2019-20, industrial production contracted 0.7% against 3.8% expansion in FY 2018-19.
Merchandise exports in Apr '20 contracted 60% to US $10.36 Billion. Imports also contracted 59% to $ 17.12 Billion. Trade deficit shrank to $6.76 Billion from $15.33 Billion a year ago.
BSE Sensex index chart pattern
The daily bar chart pattern of Sensex has formed a bearish pattern of 'lower tops, lower bottoms' after forming an 'island reversal' pattern on May 4th. The index closed below its three daily EMAs in a bear market.
By touching an intermediate top of 33887 on Apr 30, the index retraced 49.6% of its fall from the Jan 20 top (42274) to the Mar 24 low (25639) - falling just short of the 50% Fibonacci retracement level that often terminates a bear market rally.
An interesting technical pattern occurred on Wed. May 13 after PM's grand announcement of a 'stimulus package' the previous evening. The index opened with an upward 'gap' above its 20 day EMA, partly closing the downward (island reversal) gap formed on May 4, but failed to overcome the resistance from its falling 50 day EMA.
Part/full closing of a 'gap' is often followed by a continuation of the previous trend. A downward 'gap' below the 20 day EMA formed on Thu. May 14 - confirming the 'rule' and putting bulls in their place. A series of explanations by the FM about details of the stimulus package failed to stimulate the market.
Daily technical indicators are looking neutral to bearish. MACD is about to cross below its signal line in neutral zone. RSI has slipped below its 50% level. Slow stochastic is moving down towards its oversold zone after emerging from it.
What next for Sensex? Expect bulls to remain active till the massive RIL rights issue hits the market on May 20th. The main purpose of the issue is to retire high cost debt with 'no cost' loan from investors. The CMP was pumped up after poor results. The 'discounted issue price' (at a huge premium) is a trap. Here is a history lesson: Why rely on Reliance?
NSE Nifty index chart pattern
The weekly bar chart pattern of Nifty took the grand announcement of PM's Rs 20 Trillion economic stimulus in stride, and closed below its three weekly EMAs for the 10th straight week. The index lost about 115 points (1.2%) on a weekly closing basis.
The sharp bear market rally from the Mar '20 low of 7511 terminated at the Apr 30 intermediate top of 9889 - retracing 48.3% of the fall from the Jan '20 top. By falling just short of the 50% Fibonacci retracement level that often terminates bear market rallies, Nifty's chart remained under bear domination.
The 20 week EMA crossed below the 200 week EMA some time back. All three weekly EMAs are falling, which is a sign of a long-term bear market. The 'death cross' of the 50 week EMA below the 200 week EMA - which will technically confirm a long-term bear market - is awaited but should occur soon.
Weekly technical indicators are looking bearish. MACD is moving sideways below its falling signal line inside oversold zone. RSI is falling inside bearish zone. Slow stochastic has dropped sharply from its overbought zone.
Nifty's TTM P/E has moved down to 20.98 but remains above its long-term average. The breadth indicator NSE TRIN (not shown) is oscillating about the edge of its overbought zone, hinting at near-term index consolidation or correction.
Bottomline? Sensex and Nifty charts continue to trade below their respective 200 day and 200 week EMAs in bear markets. Positive corona virus cases are increasing rapidly. Any easing of lockdown restrictions can start a second wave of infections. Small investors should stay on the sidelines and protect their cash.
India's factory output contracted a record 16.7% in Mar '20 (thanks to the lockdown) against an expansion of 4.62% in Feb '20. For FY 2019-20, industrial production contracted 0.7% against 3.8% expansion in FY 2018-19.
Merchandise exports in Apr '20 contracted 60% to US $10.36 Billion. Imports also contracted 59% to $ 17.12 Billion. Trade deficit shrank to $6.76 Billion from $15.33 Billion a year ago.
BSE Sensex index chart pattern
The daily bar chart pattern of Sensex has formed a bearish pattern of 'lower tops, lower bottoms' after forming an 'island reversal' pattern on May 4th. The index closed below its three daily EMAs in a bear market.
By touching an intermediate top of 33887 on Apr 30, the index retraced 49.6% of its fall from the Jan 20 top (42274) to the Mar 24 low (25639) - falling just short of the 50% Fibonacci retracement level that often terminates a bear market rally.
An interesting technical pattern occurred on Wed. May 13 after PM's grand announcement of a 'stimulus package' the previous evening. The index opened with an upward 'gap' above its 20 day EMA, partly closing the downward (island reversal) gap formed on May 4, but failed to overcome the resistance from its falling 50 day EMA.
Part/full closing of a 'gap' is often followed by a continuation of the previous trend. A downward 'gap' below the 20 day EMA formed on Thu. May 14 - confirming the 'rule' and putting bulls in their place. A series of explanations by the FM about details of the stimulus package failed to stimulate the market.
Daily technical indicators are looking neutral to bearish. MACD is about to cross below its signal line in neutral zone. RSI has slipped below its 50% level. Slow stochastic is moving down towards its oversold zone after emerging from it.
What next for Sensex? Expect bulls to remain active till the massive RIL rights issue hits the market on May 20th. The main purpose of the issue is to retire high cost debt with 'no cost' loan from investors. The CMP was pumped up after poor results. The 'discounted issue price' (at a huge premium) is a trap. Here is a history lesson: Why rely on Reliance?
NSE Nifty index chart pattern
The weekly bar chart pattern of Nifty took the grand announcement of PM's Rs 20 Trillion economic stimulus in stride, and closed below its three weekly EMAs for the 10th straight week. The index lost about 115 points (1.2%) on a weekly closing basis.
The sharp bear market rally from the Mar '20 low of 7511 terminated at the Apr 30 intermediate top of 9889 - retracing 48.3% of the fall from the Jan '20 top. By falling just short of the 50% Fibonacci retracement level that often terminates bear market rallies, Nifty's chart remained under bear domination.
The 20 week EMA crossed below the 200 week EMA some time back. All three weekly EMAs are falling, which is a sign of a long-term bear market. The 'death cross' of the 50 week EMA below the 200 week EMA - which will technically confirm a long-term bear market - is awaited but should occur soon.
Weekly technical indicators are looking bearish. MACD is moving sideways below its falling signal line inside oversold zone. RSI is falling inside bearish zone. Slow stochastic has dropped sharply from its overbought zone.
Nifty's TTM P/E has moved down to 20.98 but remains above its long-term average. The breadth indicator NSE TRIN (not shown) is oscillating about the edge of its overbought zone, hinting at near-term index consolidation or correction.
Bottomline? Sensex and Nifty charts continue to trade below their respective 200 day and 200 week EMAs in bear markets. Positive corona virus cases are increasing rapidly. Any easing of lockdown restrictions can start a second wave of infections. Small investors should stay on the sidelines and protect their cash.
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