Technical Analyst, Emkay Global Financial Services
Where Are We?
We have seen extreme polarity between market and economy. The index is at an all-high level and the economy is at its lowest in several quarters. After hitting an alltime high, the very next candle was bearish — technically known as Bearish Engulfing pattern. It was formed on the weekly chart which carries more weight in terms of its implication. RSI reading comes at about the 50 level. It is coming down from an overbought zone. RSI had formed negative divergence which shows lack of momentum on the higher side.
What Is In Store?
What Could Investors Do?
Along with the index, many of the sectors are at resistance or started to show some weakness. It indicates caution. At this point focus can be put on the service sector like financial or IT rather than the manufacturing sector. From an investment perspective, the ideal level seems to be around 11600 level. Besides, the reality sector is also showing a positive structure. Within that Oberoi Reality can be considered.
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