Market MATH & Watchlist

20-May-2024: Trend and Momentum Still UP

MATH: Momentum Anticipation and Trend by Homma:

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As technical traders, We

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

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Trend:

The market is on an uptrend in both the short and medium term.

Momentum:

The momentum is rising in both the short and medium term.

The medium-term momentum if sustained above the previous swing high, could be the start of a larger momentum up move.

N500:

Last week, a move to the channel resistance was anticipated.

This played out well and now N500 is approaching the resistance.

Anticipation:

In the short term, I anticipate the N500 to at least hit the channel resistance.

How the price reacts to it will be crucial.

If it contracts, goes sideways, and builds a mini coil; I will anticipate a breakout of the Ascending channel (a Bullish on bullish breakout. Read more about BOB breakouts in this article).

A vehement rejection of the zone might see the price again back to the midline or channel support.

For now, all bullish (LFG).

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Key Indices:

Midcap 150: This is the strongest space.

Nifty Smallcap 250: At their ATH

Nity Microcap 250: Looks to be breaking out of a huge iH&S continuation base

Summary:

Strongest (short term and medium term): Defense, Oil, PSEs, Auto, Realty, Capital Goods-Industrials.

If you are too confused then just focussing on PSEs would not be a bad idea

Potential Relative strength candidates for the future: Pharma (health), Oil & Gas, Energy

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Watchlists: