Bullish Market keeps getting more bullish

Market is bullish and getting more bullish day by day. The buying interest has been increasing the stock prices. It is not easy to decide to keep buying now. NIFTY 4500 has been such a mental block for traders that they are not willing to pay more beyond this range.

Interesting fact is though nothing is making them sell too. The recessionary scenario is out of the calculations now. We all have to start back from previous growth scenario and invest in companies with great potential of growth.

A healthy market correction is much needed to take out the weak sellers so that a firm foundation could be built to launch next push up to 6500. Surprisingly many companies are still not overvalues in NIFTY. The entire world investor are keen on investing. Any fall is stock prices is immediately bought by excited buyers and hence the market does not fall. It will not until the last buyer is taken out. Apparently there are many buyers left and new ones are getting added to the line.



Look at the above chart, 4500 has been a resistance marked by red arrow. If market keeps wandering in this range then it is extreamly bullish scenario as per the technical analysis. Last time I mentioned about the base building phase. NIFTY is building its own base. Any sell off to 4000 should be bought. A slight break below 4000 will be nice for long term buyers. We are in one of the largest bull market conditions. The only problem for me now is the market is not giving me any entry point to enter with better risk reward ratio. A correction will give that chance to me. We need to see another 4-5 weeks. If market holds 4500 level then its super bullish. That means there are very few weak sellers left in market and foundation to run ahead is in place.

Lets look at few buying opprtunities

Geometric is showing good strength week over week. Buying now is little late and we will never know how far the stock will go ahead.



Numeric Power systems have just started moving up above its previous resistance. There was a fractic buying in this stock last week. It might be good to check this one out with stop loss at 450.



KPIT Cummins is showing unusal strength in past few months. Just cleared its near term resistance to launch a move higher. This will excite more buyer to step in and keep buying until the valuation gets way out of normal range. Until then its party time. Do not forget to exit if market proves you wrong.

HOCL is fundamentlly very weak play. I am wondering what is moving it? Never mind, its moving higher. Consolidated for more than 6 months, now moving higher. Good chart pattern to play now.

Food for thought: Is the rally a time to keep buying or selling the stuff at premium prices?

Rally is a time were everybody is a buyer. They would pay any price you ask for. This is the time to sell your weak performing stocks. Not all the stock should be sold, but you must consider selling weak holdings of your portfolio.

Happy Trading

Anil