Market Monitor 10/11/25

Dear Folks,

Thanks a lot for coming over to support my small initiative. I had been trading and investing in Indian markets since 7 years; and had been journaling about market environment since quite some time.

Now; I have thought of sharing my reasearch to my loved ones for the benefit of all. And above all; my piece of writing wont be behind the paywall ever.

So; writing newsletters will be beneficial to me as well in the regard of keeping me disciplined and consistent with my approach.

The chart of Nifty50 is near all time highs; but seeing the index isn’t is the right way to determine the market environment. Index is heavily dominated by a few constitutions and our Nifty index is dominated by Financial sector companies specially NBFCs, and private banks.

So; for checking the broader health of the market we look over to the breadth; maybe CNX500 or Nifty MidSml 400 which better signifies the overall environment of the markets.

The dashboard above is the single most important data to track the market environment. As this is my first newsletter; I will be explaining this dashboard in detail.

The 1st chart is of the Smallcap Index and as it is seen; we are in a very long sideways market; which is extremely choppy in nature.

Basically; the market is not trending in any direction; it is just sideways and this is the most deadly environment for swing traders as we trade directionally in the flow of liquidity.

As the Market Wizard DAVID RYAN says this phase of market can last for 12-18 months and instead of buying breakouts; buy pullbacks; only in the businesses which you have studied deeply.

This phase of the market bleeds you by thousand cuts.

The direction of index is complimented by 2 other data points; NNH (Net New Highs) and % of stocks above/below key EMA (Exponentially Moving Averages);

The data of NNH signifies that every other day we are hitting more lows than highs; signifying the market environment is not good and there is very less likely probability of making money; one should sit tight over cash instead of trading in such markets.

And the 3rd data point is % of stocks over key EMAs; so if anyone have backtested the data of bull market when every Ram, Shyam and Gopal makes money; the breadth always remains above 50 mark. However, right now we are below the 50 mark; and also the breadth is in sideways movement and is not uptrending which showcases its not the right time to take fresh entries.

Guys; am stressing a lot there on the market environment right now because it is the single most important thing that matters in the equity markets. You will have setups to trade every day in the markets but those setups wont have the probability to make you money.

The breakouts will happen but there will be highly likely probability of failure; there will be squatting post BO; shakeouts post BO.

If you wish to live long in the markets then always keep this mantra in mind-

ENVIRONMENT>SECTOR>INDIVIDUAL SETUPS

And also whatever we will be discussing here will be data backed; I wont be throwing darts in the air.

Apart from the environment; when we talk about sectors; folks you can observe there is only one Sectoral Index which is in momentum: that is PSU banks and that is showing no chance of fadeout;

Apart from it commodities and metals are the sectors; that are reversing to weakening quadrant. Which means there are a very few sector holding up the index; and at any moment there can begin a fresh downside move.

On the contrary; when there is bullish market environment you would observe all such indices either in leading or weakening quadrant signifying broad based rally.

Apart from PSU banks; Alcohol Sector is doing pretty well; likes of Radico and ABDL hitting all time highs because of the increasing premiumization mix.

Also this market is rewarding earnings; companies which were in ignored territory and are reporting excellent results. But guys still; the Dalal street has very high expectations of earnings from the companies; if not being delivered; the companies are being butchered accordingly.

Trading Earnings (EPs) is the single most setup that work in every market environment; however for that it requires great agility and is a time consuming and also requires extreme screen watching as in this market the EPs are also not sustaining much post 2-3 days move. You can only make money taking intraday trades.

Somewhere later; I will be explaining about trading EPs in great detail.

Pennar cracked pretty bad on below expectations results.

Neuland was up 10% pre market; though it gave back all the move.

Today; only HBL Eng and Lumax Auto survived on good earnings.

Guys; am still saying this is not the right environment to take entries and taking trades. If still you cant hold your horses then focus on PSU Banks, Small Private Banks and NBFCs coz those are the only sectors showing strength.

Auto, Metals and Commodities are slowly losing momentum.

I am attaching a list of companies which have delivered blockbuster earnings growth till now-

(Always remember; Price is the slave of earnings)

Always focus on companies and sectors reporting great earnings along with sector being strong and proper setups; that is the holy grail of making money.

Triple digit EPS reported- https://in.tradingview.com/watchlists/196914985/

>25% EPS reported with 20% revenue increase- https://in.tradingview.com/watchlists/179006936/

Guys; also one can look into the chart of Gold and Silver-

Precious metals had been a leader this year.

Gold and Silver are reversing on charts; what technical traders call- EMA undercut rally.

Both have tested their 21EMA and 50EMA forming a small pivot and reversing.

Thanks a lot guys for reading till here. We will be talking about some other important topic tomorrow.