The BSE pops 185 points, +0.5%, to 39056.65 a new all-time closing high (the chart above is not yet updated). Don't you love the market makers that adjust price by a penny at the close to avoid the '666' print. The high of the day is 39121.69 a new all-time record high. India is hot. Everyone wants a piece. Traders celebrate with mutton curry for all!
24 years ago, the Bombay city name was changed to Mumbai to remove the connection to British colonialism. The Mumbai name is reflective of the Maratha heritage and pays honor to the goddess Mumbadevi. However, humorously, black Bombay cats will not be called Mumbai cats.
Last year's all-time high was 38989.65 on 8/29/18 and prior all-time closing high was 38896.63 on 8/28/18. Yesterday, 4/1/19, a new all-time high occurs at 39117.29. Today, these all-time highs are all taken out.
With the joyous price record, the indicators are in negative divergence except for the MACD line. The rising wedge pattern and overbot conditions are bearish. The upper band is violated so a move back to the middle band at 37.7K, and rising, is on the table. There is a potential double-top, or M Top, in play. For the bulls, the upside trend is strong as per the ADX.
A little stutter-step may occur, one day down the next day up again, to roll the MACD over into neggie d, which will identify a top in this daily time frame (this week). The new all-time record price highs come with negative divergence and overbot conditions on the weekly chart. That's not good.
An advantage that BSE has is momentum. Sometimes momo can keep the party going especially with the new all-time records. Joe Sixpack will get all excited and buy shares that the smart money will dump off on him. Think seriously about the trade before shorting a hot stock or index. Have an exit plan no matter what the outcome. The BSE monthly chart is in negative divergence with the new price high.
Despite the joy in India today, start selling. If you enjoyed profits over many months or even years begin exiting stage right. You can scale out over the next couple months. If you are a shorter-term trader that has profits, take them right away and move on. India can be viewed as a short candidate going forward for the rest of the year. Potential short plays this year would include INDY and EPI the India ETF's. Keystone has no positions in India currently. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
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