On Monday the 20th April, due to the fear of corona issues and lockdowns, market was expected to fall. It did open gap down but recovered closed above the day high.
On Tuesday the 21st, it was expected to open higher and go further up but though it opened gap up it then started falling and kept falling.
Is it classic manipulation in the working? FIIs etc initially take the market in the general expected direction and then reverse it sharply to trap the retail traders. Yes, traders have to be good technical analysis and SL but is it not shameful if institutes are collectively doing it ?
Just sharing my views based on my personal experience- not specific to you but a general note- One of the main reason for traders to fail is they try to blame their loss on someone else instead owning it and learning and improvising on their trading plan. I think trading is one of the toughest jobs and it literally means one has to fight continuously with great minds and super computers to stay successful.
No one can prove it and let it be true also but it is part of the game, one has to work on their own trading plan to survive in the markets.
Not all gap-ups and gap-downs in market continue in the direction of the gap. Some fail.
You are looking at April 19th. Take a look at at a week earlier on April 12th. The Nifty50 gapped down and closed the day on red. If FIIs do manipulate markets, then why didn’t they do it on 12th?
It is hard to even determine if there is a manipulation.
The price action is a collective of all market participants behavior. The Nifty50 index on April 19th and 20th was(Still is) hovering around its 100day moving averages. Many market participants tend to buy stocks/go long whenever the prices come near key moving averages/price levels. 100day SMA is one such psychological level where many buyers jump in considering it a ‘good buy on dip’ opportunity. That’s how support levels work: when there is demand (due to behavior). But, this is not guaranteed to work always. Just a higher probability. Somedays it fails. That’s how support levels/resistance levels break and a new trend (it could be long-term/intermediate/short) starts.
I personally feel, rather than ‘why’ something happened in market, we need to be focused more an ‘how’ we react to an event/price action/setups.
I think we need to handle risk well, and take into account that somedays the market won’t trend in a direction, somedays it would revert to its mean and adjust our position size accordingly.
What I am trying to say is that It is hard to predict the market. Maybe, it is even futile to predict it.
