On Nifty – My View Since the Budget Day Selloff
After the Budget speech on Sunday and the sharp selloff that followed, I clearly expressed my view that Nifty has either already made a bottom or is extremely close to forming one. The overall structure suggested that the downside was largely exhausted, and from there the index had the potential to generate a strong and swift move on the upside.
Even yesterday, in my communication with clients, I specifically discussed taking selective long entries in quality stocks. This was not a sudden shift in stance – it has been a consistent view right through this entire correction.
Since the beginning of this decline, which started from the January 5th high, I have maintained one clear position: this fall is a temporary pullback within a larger ongoing uptrend. My belief has always been that Nifty remains well poised to make further higher highs in the months ahead.
Adding to that, the cycle calculations that we have been working on for weeks have given us significantly higher targets on Nifty – numbers that, at this moment, most people would not agree with or even imagine possible. I have already shared those targets and the logic behind them with my clients. Based on that understanding, I have been steadily adding bullish positions in indices and select stocks throughout this entire pullback phase.
Now coming to today’s price action – as far as today’s gap up is concerned, that was not in my expectations at yesterday’s close. Even to my clients, I had clearly marked February 4th as a critical date for a potential turn. The move has started earlier than anticipated, but that matters less for existing positions.
However, for fresh short-term entries, it becomes a tougher call now.
What is important is this – today’s gap is technically very significant. It appears to be a classic breakaway gap. To give you some background, in Nifty’s history we have seen similar breakaway gaps in early December 2023 and again in late July 2022. Those gaps were never filled, even as of today.
The purpose of mentioning this is to highlight how powerful and meaningful such gaps can be going forward.
At the same time, today’s gap is still a work in progress. For it to gain further strength and confirmation, the index still needs to take out today’s high decisively.
Once that happens, Nifty would effectively be in open blue skies with accelerated momentum. And in my view, that would only be the beginning of the larger rally I have been anticipating.
One thing the market has taught us over the years is simple – never mess with momentum.
So let’s see how it unfolds.
What truly matters is this – even at the worst point of sentiment, when news flow, price action, and emotions were completely against a bullish thesis, I did not change my stand. I kept repeating the same message with discipline and conviction.
Markets test patience, not logic.
And this phase looks no different.
gann,insides 