NIFTY and SENSEX form shooting star, Are your ready with cash?

On 22nd June 2017 both BSE Sensex and NIFTY 50 formed the shooting star. Thus the long waited market correction seem to be in very near future. Many analysts are of the same opinion.
BSE Sensex forming shooting star. Screen shot from money controll app.
Nifty 50- formation of bearish shooting star in one month chart. Screen shot from Money control app. 

What is a shooting star?

Shooting star candle stick pattern happens when the bulls push the market up from the opening price and fail to sustain against the pressure of bears. The market comes back near to the opening price and closes with a little loss. This happens when the bears have upper hand than the bulls. A shooting star candle stick will have a long upper wick, small lower body, small or no lower wick. If such a candle occurs in a bull market, it is called as shooting star, if the same happens in a bear market then it is called as inverted hammer. They reverse the matket trend. A shooting star seems to have occurred with Nifty 50 and BSE sensex on 22nd June, making the analysts to believe the beginning of near term correction phase. This is confirmed with another long bearish candle on the next day, 23rd June 2017.

What should an investor do?

Indian stock market is bullish in long term. Every such small corrections need to be utilised to buy the value stocks. Keep the cash ready and invest in fundamentally strong stocks to get multibagger returns. One can also make use of the market corrections to invest in mutual funds.

The formation of shooting stars does not guarantee the bearish market. The opinion of the analysts could be wrong. Do your own study, consult your advisors before taking calls. 

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