Nifty Correction Is Purely Technical. May Last Longer

The benchmark Nifty50 ended Thursday’s, 18th May 2017 session with a net loss of 96.30 points or 1.01 per cent.

We may cite fresh political uncertainty in the US and the resultant weak global set-up for Thursday’s decline, but the correction witnessed was purely technical in nature. The market has marked an immediate top and we expect this corrective activity to continue for some more time while keeping the primary uptrend intact.

The Relative Strength Index on the daily chart stood at 60.5907 and it remains neutral. The daily MACD still remains bullish even as it trades above its signal line. No significant formation occurred on candles.

The market is expected to display corrective tendencies for some more time. If it forms a fresh area pattern, it is not likely to see any runaway rise. Investors now need to shift their focus on good quality stocks that had remained laggards during the rally phase.

Effective churning of sectors and investing in stocks that had not participated in the current rally will hold the key in the coming days. Even if the market sees more corrective downsides, the primary uptrend will remain intact.

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