1. First things first. The bears are firmly in control. I had written last weekend on how much work the bulls will have to do in order for the charts to start looking in their favor once again. Well, things have just got tougher for them since then. So, all moves next week should be made keeping in mind that the bears are firmly in control at the moment.
2. That being said, the markets are in oversold territory and this coupled with the market action on Friday, the odds favor the bulls in the very short term i.e. the first half of the week. MA(200) will be the first resistance that the bulls will have to face and it would not be surprising to see a run up to that level.
3. If you do want to play this probable bounce, be nimble and dont get too greedy. Be on the lookout for intraday plays. Stop losses must be strictly adhered to as the bears remain in control overall. Averaging down is certainly not an option.
Here is the watchlist for next week.
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Take care and good luck!
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