Thread by @GordunGekko

Is this "just another healthy correction in India's long term bull market" or is this "start of a prolonged bear market"?

I tried to do some research on this. For this, I decided to look at #Nifty 's weekly chart. From my earlier observations/ chart reading over several years,

I have observed that the 100 week moving average serves as a very robust "long-term" support/ resistance. (Note: some others prefer using 104 --- as that coincides with 2 years of 52 weeks each --- while some others prefer 108 --- as that has a special significance in Hindu

religion/ astrology --- but that's ok, wouldn't make a huge difference).

So, let's see what the chart is showing us:

Nifty 100 W (Simple MA): We are bang in the middle of the high-low band. So long as we don't give a weekly close below 15032, I would view this as a "healthy

correction". Let's see how has this 100W high-low band held up in the past

And here are some more examples...

What these examples suggest is that, 100 W high-low band is something worth taking seriously. It generally holds, and when it doesn't, it signals a much deeper problem (like the 2008 financial crisil, or Covid in 2020)

Now, coming back to today, using the 100W high-low band as a reference point, a close below 15032 (let's round it off to 15000) would be something I would be watching closely.

By the way, let's look at what's the status of other indices:

Bank Nifty -- again smack in the middle

of the high-low band. A close below 32300 is worth watching.

Nifty 500 -- again right there...
Nifty Small Cap 250 -- same story...

It's as if all the indices are doing a choreographed movement...

Bottom line:
I personally will watch for a "weekly close" below these bands.

Nothing is certain/ guaranteed in the market. And nothing works all the time. But, it's always helpful to have some reference point. The above analysis is merely to help us get some reference point/

guiding light in this uncertain world.

Hope you liked it.
Cheers!