Market under went much awaited pullback/correction and still trying to find firm footing. Will this convert into a full blown correction OR Will a bounce convert into continuation of BULL rally? Whats your take!!! BPNYA is at level NOT seen in quite some time and when it crosses EMA(30) shall provide awesome buying opportunity. Volatility ($VIX) drastically rose to level NOT seen for quite some time which dragged the market. As soon as market broke MA(200) support, free fall continued. Is current bounce here to stay!!! Weekly chart shows that once this market broke trend line, it dropped to next support level. Market gave us enough clues before the actual drop, how so? Check RSI and MACD divergence with Price, also as long as RSI managed to stay above 50 mark, market pullback was contained. NYUD also gave us enough clues before the actual drop, how so? Current NYUD peak could NOT penetrate earlier NYUD high, also as soon as NYUD broke EMA(21) support and RSI dropped below 50 mark, market took a dive. As you can see, above charts gave us enough time to exit before the actual drop. Now the key question remains, Have we reached a bottom yet!!! Earnings season is underway which will add more volatility to the market. Most likely the bottom will be established in next week or two after which we shall see a nice year end rally. There is no reason to rush as charts will tell us when to enter the market.
What does it mean for our Investments?
Market still in correction trying to find support...
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