On Sunday Midnight before the asian markets got underway and well before the Nifty open, Shai had posted a chart of the McClellan index in his weekend post here.
Here is the chart again for reference :
I quote from his comments :
“the indicator is getting extremely oversold which means you have to be cautious if you are trading short.The risk-reward does not favor new shorts at the moment”.
Here is the updated chart as of the close of today’s session.
In 3 sessions the Nifty is up about 210 points from that close and the McClellan registered a +10 reading today.
Whilst many of you today may be hearing people on TV and other blogs talk 6300 again (the same people told you 5400 about 4 days back), the point I want to make over here, is how many of you have come across analysts who will stick their neck out and tell you the market picture as it is.
We call Shai the “Little magician” in our circles. He has always been humble and ‘behind the scenes’ player letting his work speak more.
Here is an excerpt from his post on 20th November, 2 saturday’s back and notice the to and fro movement of the Nifty described here :
“the fact remains that the Nifty has a lot of work left ahead to resume it’s faltering uptrend.
We at Vtrender are not in the business of picking tops or bottoms, but have reasonable conviction to state that the bottom may be just 100 points from Friday’s closing levels”.
That Friday in the statement was Nov 19th.Again later
“We estimate the 5775 region to be the swing low from where a reasonable 200 point rally should materialize“
Got that 200 pointer done today.