Market MATH & Watchlist: 15-Nov-2024

Bearish Bias

MATH: Momentum Anticipation and Trend by Homma:

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MATH last week: Click the link

The most comprehensive article on Breadth and Anticipation:

The 3 bulls framework for situational awareness

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As technical traders, We

“Anticipate, but confirm. Wish, but only react.”

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Trend:

Short-term: “Percentage of stocks above 10-DMA”

Medium-term: “Percentage of stocks above 50-DMA”

Both are in oversold territory (both below 20%).

A bounce generally follows once the breadth reaches this level (the confirmation will be the plot crossing above its 5-SMA).

That would be a counter-trend bounce and likely short-lived as long as we trend below the 50 mark.

Momentum: Homma Mswing Score

The Mswing score is back below the oversold zone.

Hence a bounce off the oversold levels can be expected.

But as mentioned previously, I expect it to be short-lived.

N50:

The third scenario played out as discussed last week (see screenshot below).

The big support was broken down.

The highest probability scenario would be for Nifty to reach the small H&S target but not before a bounce to the key short MAs which will act as resistance along with the huge level of previous support.

N500:

Similar to N50, a big support zone breakdown.

I anticipate a small down move followed by a bounce which takes it to the key MAs and the support zone followed by a continuation of the downtrend.

Net4% Movers:

Sellers dominated the week.

Closed with a feeble buying but not quite enough.

Anticipation:

The bias remains the same as last week.

Positionally I am bearish as long as the indices are trending below the 50DMA.

While we may have small countertrend bounces toward the small-term key MAs of 10 and 20.

Agile traders might be able to trade those bounces, but not doing anything would be a better option for most.

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Group Strength:

The strongest groups last week:

Index:

Nifty IT was the only index that closed in positive (May be the last group to breakdown?).

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Watchlists:

No Money environment so Long Trades are on leave.

Except for intraday longs.

I use the Strong Start scanner for stock selection here.

You can find them during the first 5 minutes of the day using the scan Strong Start on the scanner section of my website

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