NIFTY IT : BOUNCE BACK Nifty IT corrects almost 35 percent from the top, so that bounce also expected to be Big, ie near 20-25 percent from recent low created of 26300...
Bounce back expected to levels 31500 , 32000 or 34500.
And To complete Full Correction it will again fall to below levels of 26500, expected to levels of 24000
And this all expected to done till July 2023
CNXIT trade ideas
Four phases of the stock market What Is a Stock Cycle?
A stock cycle is the typical evolution of a stock's price from an early uptrend to price high through to a downtrend and price low.
Richard Wyckoff, a prominent trader and pioneer in technical analysis, developed a buy-and-sell stock cycle that occurs over four distinct stages:
Accumulation
Markup
Distribution
Markdown
How Stock Cycles Work
Stock prices may appear random, but there are repeating price cycles that are predominantly driven by the participation of large financial institutions (FI). As a result, following cash flows reasoned to originate from these large players can be identified as occurring in a cyclical manner.
The Wyckoff stock cycle has expansion and contraction periods, much like the economic cycle. It can be used for portfolio management allocation, allowing for increased investment during the accumulation and markup phases and profit-taking during the distribution and markdown phases. Investors measure a stock cycle by comparing the distance between lows to help determine where prices are in the current cycle.
A trader must have a strategy to take advantage of price action as it is happening. Understanding the four phases of price action can maximize returns because only one of the phases gives the investor optimum profit opportunity in the stock market. Becoming aware of stock cycles and the phases, allows investors to be prepared to profit consistently with less drawdown. The study of stock cycles gives investors a heads-up on trending conditions for a stock, whether sideways, up, or down. This allows them to plan strategies for profit that take advantage of what the price is doing.
Understanding the Wyckoff Stock Cycle Phases
Accumulation: An uptrend starts with the accumulation phase. This is where institutional investors slowly begin acquiring large positions in a stock. Investors use support and resistance levels to find suitable entry points at this stage of the stock cycle. For instance, investors may start accumulating a security when it nears the lower end of a well-established trading range.
Markup: A breakout of the accumulation period starts the markup cycle. Trend and momentum investors make the bulk of their gains during this phase, as a stock's price continues higher. In this part of the stock cycle, traders use indicators, such as moving averages (MA) and trendlines, to help make investment decisions. For example, an investor may buy a stock if it retraces back to its 20-day moving average.
Distribution: Institutional investors start unwinding their positions at this stage of the stock cycle. Price action begins to move sideways, as the bulls and bears fight for control. A bearish technical divergence between a stock's price and technical indicator often starts to appear in the distribution phase. For example, a stock's price may make a higher high while the relative strength index (RSI) makes a lower high.
Markdown: Volatility often increases during this phase, as investors rush to liquidate their positions. Investors use temporary retracements to the upside as an opportunity to sell their shares, while traders look to open short positions to take advantage of falling prices. Typically, margin calls increase near the conclusion of the markdown cycle, as stock prices near their lows, which may help explain the climactic volume often associated with this part of the stock cycle.
Case 2nd in NIFTY IT wave analysisCase 1st can be found here
Case 2nd: If you see the market goes below 32438.25 means the wave-C is itself as a complex correction and the market will go down more, this view will remain same until the market goes above the 36815. Chances are very high that the wave-C will be a complex corrective pattern. If you have any question you can ask.
NIFTY ITHello & welcome to this analysis on the IT Index.
With Q4 results starting from 2nd week of April, IT stocks will once again be in limelight.
If the index can sustain above 36700 it could lead to rally till 37750-38000 where it has a line of polarity besides a Bearish Harmonic Cypher.
This continuation of bullish outlook is valid till its above 36000. Failure to hold it would take it down to 35250-34500.
Key levels to watch out on both sides 36000-36800 for a trend direction move.
Nifty IT may take support at this levelCNXIT is traveling in a channel and it got a rejection from the top of the channel we have a demand zone for CNXIT from 34453 to 33500
We are going to be bullish in CNXIT until a daily candle closes below 33500.
So we can plan swing trading in this sector and we can take long positions if get any long setup in the stocks which come under this sector but we have to wait until it enter into DemandZone.
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NiftyITNifty IT
Currently in a downtrend
Suggestion: As Shown Nifty IT has always bounced back once it reached close to its 50 Day Moving Average.
Hence Expecting a Bounce back Next week in all IT Stocks
If your a risk Taker
you can Buy All the Good stocks TCS, KPIT, Wipro, BSOFT, HCL Tech Today
which is still available at a Good price & You will get Rewarded well next week.
Note: The above is only for Risk Takers and just my Suggestion.
Safe Traders only enter once there proper reversal
Happy Trading
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