What a powerful swing on Friday closing the week to Banknifty breaking the multiple tested 34140/34300 zone taking us higher. Here is a quick market update on what I am seeing so sharing some key index charts. Maybe you will find this helpful so let's put this all into context here the whole change in a trend started off when we managed to create a "W" pattern which seemed to have worked really well. The confirmation and conviction to go long appeared when we created the pattern for the second time on the 150ma & 200ma. The short covering towards the 34000 resistance zone was massive.
Sbi and HDFC Bank were key index components along with Indian officials mentioning a possibility of an economic package for the Indian economy.
The key trade was to go long above 34140 where maximum bins were created with a target of 34709 as per futures levels. The trend continues to stay strong and could certainly head towards 35278 & 35847 levels in the coming days.
A chart to also watch out for is the S&P500. The most open gap-driven market than anything else. Something that has never been seen in the past although historic markets would demand a filling as you don't always see markets chugging on so many gaps. Not calling for a crash her but just pointing out. As you can see every time the trend breaks it is saved and I really wonder for how long.
So that's always a risk that you get some sort of break and set on a trend to filling out all these gaps. Maybe a straight line or may back and forth. Who knows?!
Gold on the other hand managed to give such a clean break out of the weekly falling wedge. So that's a bullish gold but that doesn't mean we go back down. Well, what would gold possibly be indicating here is in conjunction with all the volatility underlying these index charts that I have mentioned and is now outperforming some hedges. From my perspective you have to be tactical in being aware of the different risk levels and so forth. We shall see how this all plays out.
Anyways thats my perception and it may vary. Goodluck everyone and I hope this was helpful. Take care!