- The Nifty 50 in India has bounced a bit during the trading session gaining about three quarters of a percent as we have bounced from the 50 day EMA.
- This is a market that I think is very interesting to watch at the moment because it can give you a sign as to where we might be going in the future.
We broke a major downtrend line over the last couple of sessions and now we're dancing around the 200 day EMA. The 200 day EMA is an indicator that a lot of people will be paying close attention to. And if we can clear that and then get above the 24,000 rupee level, it's very likely that the Nifty 50 will continue to go much higher.
Sideways for the Time Being?
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In the meantime, we might see a little bit of sideways action, which makes a certain amount of sense considering that breakouts don't typically happen in one fell swoop. They tend to be a process, and we might be in the process of trying to bottom out here overall. India of course is a great proxy for all things Asia and more specifically emerging markets. So, this is an index I do watch from time to time to give me an idea how to trade not only the nifty 50 but other indices around the world or perhaps more likely emerging market currencies. It just gives you a good vibe as well as a data point from which to place trades. The Nifty 50 breaking above the 24,000 rupee level could open up a move back towards the 26,000 rupee level. But I would say at the same time, if the Nifty 50 breaks down from here, we will have to see whether or not there's going to be any support at 22,750 rupees next.
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