Stock Market Live: As Sensex and Nifty move higher, bears appear to be defeated for the time being

Investors in the Indian stock market rejoiced when thebenchmark indices made lifetime highs. Sensex hit 50,000 and Nifty hit 15,000,but could not hold there.

As the prices began dropping, investors were in confusionwhether the downfall is a retracement in an otherwise strong uptrend, or thebeginning of the reversal of the trend.

At this point, it appeared technical analysis-wisethat both scenarios are equally likely.

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What happened next till the time of writing (January 4, 2021around 2:32 pm IST) is as follows:

Then, the index had a Bull Elephant Bar bouncing from thezone of the 50 SMA which not only eliminated the previous day’s red candle butovershot the same to eliminate last two Bear Elephant Bars.

The next day was a gap-up opening, though the day’s high-lowrange was quite small as compared to the previous day.

The next two candles (including the one today) are green butsmall in size and seem to hitting the resistance at 15,000.

However, the recent high of the price action has been leftbehind. The importance of this action is based on the technical analysisprinciple of switching of the role of a support into a resistance once it’sbroken, and vice-versa.

Thus, once the previous recent high was broken yesterday andtoday it is holding with a green candle above it leads to an estimation that thea bull rally has started.

Still, whatever may this analyst’s analysis of the market,every participant in the market has to make their own decision.  Also, all information discussed on this topicon this website is for education purpose only.