Market MATH & Watchlist

25-Aug-2024: Bullish but threatening to get extended in the short term.

MATH: Momentum Anticipation and Trend by Homma:

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MATH last week: Click the link

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As technical traders, We

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

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Trend:

Positive and above its 5-DMA

But, around previous highs.

Momentum:

Positive and above its 5-DMA.

N500 (same for N50):

the index is up 4% from the swing low.

Now around the previous all the time.

The current candle could be a pivot high which will make it a lower high.

It is also slightly extended from the short-term MAs (10/21)

Net4% Movers:

Since the bullish move on the 16th, Net4% has printed well bullish numbers last week.

The bullish intensity has been decreasing though.

Anticipation:

The environment is highly bullish but looks extended in the short term.

Many strong names would go sideways or pull back to their 10/21 while some others would get extended.

As such, it could give a feeling of sluggishness in the indices and the possibility of pullback becomes higher.

If the bullishness remains strong, the pullback might look like a sideways action before eventually the uptrend resumes.

As, long as the Breadth is above 50% and the momentum plot is positive or the Net4% breadth continues to print positive numbers, positionally we are fine.

Swing traders should consider de-risking the trades.

I am also open to the possibility of this swing high (lower high) being the right shoulder of an H&S Top which could mark a medium/long-term Top. (Just thinking out loud here)

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Group Strength:

Strongest (short term and medium term):

Index:

Pharma-Health, IT, FMCG, Consumer Durables

Strong Groups last week:

Pharma API and smallcap

Auto ancillaries

Telecom

EMS

Jewelers

IT smallcap

Watch out for Strength:

Transformers

Railways

Aquaculture

Water infra

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Watchlists: