If you are caught between a rock and a hard place, you are in a difficult situation where you have to choose between two equally unpleasant courses of action.

In many Indian stocks that is exactly where many market participants find themselves.

Let's take a look at why.

Interest Rates continue to stabilize in the US and globally, setting the stage for rotation into several beaten-down areas of the Equity market...particularly in small banks.

This was a risk to our near-term bearish thesis and suggests the major indexes could push marginally higher in the very short-term. And while we ultimately believe further weakness is ahead over the intermediate-term, we have to acknowledge and monitor this rotation under the surface to see how it develops.

Several stocks we're watching could benefit from this "dash for trash" trading environment taking place in the market. Not only are they attractive reward/risk opportunities on their own, but more importantly, how they perform will provide important information about risk appetite and the potential for the market to extend further to the upside. It's the same reason we were monitoring Autos and Media earlier in the month.

The Nifty IT Index remains subdued due to weakness in its largest components, like Tata Consultancy, but under the surface, there's been leaders like Info Edge (Naukri) trending well on an absolute or relative basis.

With that said, several charts are suggesting this leader may be transitioning into a laggard.

Let's take a look at the chart that sparked this thesis.

Below is a weekly chart of Info Edge (Naukri) relative to the Nifty Next 50. Since its breakout to new all-time highs in early 2014, we've seen the Fibonacci Extensions from its 2008-2009 base serve as solid support/resistance levels. Recently, prices hit our fourth upside objective at the 423.6% extension near 0.1056 and have not exceeded it yet.

Click on chart to enlarge view. 

The Nifty Financial Services Index continues to show relative weakness.

In this post, we're going to update our risk management levels, targets, and discuss the components within the index that are showing the most relative strength and weakness.

Reliance Industries is in the news this week due to an investment from Facebook in JioMart.

Regardless of the fundamental merits or impact of this deal, let's analyze the charts and see how the market's digesting this information.

From the desk of Tom Bruni @BruniCharting

Bonds are on the move once again, so we're updating our risk management levels and targets.

Additionally, we'll revisit the ratios to analyze which credit quality and duration characteristics remain in favor.

Over the last few weeks we've been outlining what conditions would warrant us getting more aggressive on either the long or short side, and last Wednesday we got our signal to get short again.

After the indexes pressed to new marginal highs late in the week, we've finally gotten some downside follow-through to confirm the weakness we were looking for.

Let's review several key aspects of our bearish thesis and a few ways we're taking advantage of the volatility.

From the desk of Tom Bruni @BruniCharting

It's been a while since our last post on Canadian stocks, so today we're going to take a look at the trends that matter and the related trends.

Post #1 of  2 focuses on sector relative trends.

Post #2 of 2 focuses on the absolute trends and stocks we want to be buying and selling.

In our first post, we talked about relative performance in Financials rolling over aggressively. On an absolute basis, the TSX Capped Financials Index is stuck below its December 2018 lows and 2015 highs, much like US Small-Caps, the German DAX, Euro Stoxx 50, and many of the other weakest markets out there. As long as prices are below 263, the bias is to the downside with a target near 210.

Click on chart to enlarge view.

From the desk of Tom Bruni @BruniCharting

It's been a while since our last post on Canadian stocks, so today we're going to take a look at the trends that matter and the related trends.

Post #1 of  2 focuses on sector relative trends.

Post #2 of 2 focuses on the absolute trends and stocks we want to be buying and selling.

First, let's start with the TSX Capped Financials which represent 33% of the TSX Composite. This chart has spent the last four years putting in a major top and the underperformance looks likely to continue. From that perspective, can the TSX Composite continue to work sustainably higher if its best players are underperforming so drastically? I'd argue no.

Click on chart to enlarge view.

Throughout March we've been talking about weakness in the Rupee and the underlying trends driving it (March 3rd, 2020 and March 26, 2020).

Today we want to revisit the Rupee and talk about the pattern that's suggesting an explosive move is ahead.

From the desk of Tom Bruni @BruniCharting

In late February we were shorting Sugar aggressively and captured a good portion of its sharp move lower.

Now we're looking at another sweet setup in the Sugar market.