Market took a nasty turn in last two weeks, many are doubting if this bull market is over! Will this pullback turn into a bear market! Is this right time to get in! What can we expect in near term? BPNYA is back below 70 mark, it also crossed EMA(30) triggering sell signal two weeks back. Volatility($VIX) is on the rise again which is causing this market to have wide swings and decline. On NYSE daily chart below, we can see divergence between Price and MACD. MA(50) support is broken as of now and next major support is near MA(200). Divergence is very visible on weekly NYSE chart below, we have mentioned this many times in our earlier post. NYUD still above EMA(21) suggesting this is a correction in current bull market. We all might have heard the term "Sell in MAY and GO AWAY".... typically month of MAY is considered weak for the market and many sell-offs happen during this period. The bigger question will be to understand if this correction is just a normal event seen during BULL markets or start of bear market! Current charts are suggesting correction and NOT a probability of bear market. However, that does not mean the correction will be shallow or just for few weeks. Corrections can be 10-15-20% and can take significant toll on the market and investors. The key is to remain alert and cautious during such times. Also earnings season has started which would add more volatility to this market.
What does it mean for our Investments?
Market in pullback mode hence be cautious... Comments are closed.
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