DeepDive Week 11, 2025: US Indices face the heat of panic selling. Bitcoin no more a safe heaven for investors. Nifty seems indecisive. Gold & Silver shine!
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Week 11: 10th - 14th March, 2025
TABLE OF CONTENTS
Major Global Indices
S&P500
Bitcoin
US Dollar Index (DXY)
Hang Seng
Indian Indices
Nifty50
Midcap Index
SmallCap Index
Market Breadth of Indian Stock Market
Precious Metals
Gold Futures Index (MCX)
Silver Futures Index (MCX)
GLOBAL INDICES
The week was full of wild swings in the major Indices of US, as in Trump2.0 it navigates through the dual complexities - Internal (inflation, slow growth and joblessness) ; and External (trade wars).
Did you read our previous DeepDive Newsletter where we mentioned the ‘signs’ suggesting tough future outllook for the US economy? Read here.
Every trader should accept that charts ultimately speak the truth. The global cues are also hidden in the price action of major global indices. Therefore, before we look at the Indian stock market scenario, it’s important to see what happened in the Major Global Indices, during the week:-
S&P500 Index: chart on ‘daily’ timeframe. (Source: TradingView)
Index broke the 200DMA kept trading below it, for the entire week. Week’s price action can be seen in the yellow box. At the week’s low, Index had corrected by over 10% from it’s recent ATH level. Index isstill not in the bear phase, which only starts when correction is more than 20%.
In our earlier DeepDive Newsletter, we busted the myth around Bitcoin’s stability, and established it’s correlation with S&P500 Index (read here). Did Bitcoin imitate volatility in S&P500 during this week too? Yes, it did!
Bitcoin Price Chart on ‘daily’ timeframe. (Source: TradingView)
The price breaks down below the 200DMA, and traded the entire week below it Even through the movement is similar to S&P500, the big shakeouts and wide spreads suggest higher volatility in Bitcoin. At the week’s low, Bitcoin has corrected more than 25% from it’s recent ATH level.
Next important global index to track for Traders is - US Dollar Index (DXY).
US Dollar Index: chart on ‘daily’ timeframe. (Source: TradingView)
The Index trades the entire week in a narrow range, just at it’s support level. This support coincides with 5th Nov’24 level i.e. the start date of the rally in DXY after Trump won the US Presidential Election.
And, last is the Hang Seng Index. This Index has outperformed any other major Index during the past few months. Around 4 weeks back, in our DeepDive Newsletter (read here), we spotted the index at the right levels - when the risk:rewards was favourable and when it was not in the radar of many traders. Since then, the Index has been a clear outlier, week after week.
Hang Seng Index: chart on ‘daily’ timeframe. (Source: TradingView)
The Index is consolidating above the resistance zone, after it broke out above it around 4 weeks back. This is a healthy sign, as charts need rest before they continue the rally higher. Look in the chart how the previous breakout attempt failed, as the rally was straight up without any consolidation. This time it’s different, and the breakout above the narrow range (yellow box) confirms the uptrend continuation.
INDIAN INDICES
The price action was muted in the major indices of Indian stock market. Previous week’s (Week 10) closing days saw a technical bounce from the oversold market breadth. Let’s see what happened during this week:-
Nifty50 Index: Price Chart on ‘daily’ timeframe. (Source: TradingView)
Nifty trades in a narrow range during the week (yellow box) just below it’s 21DMA. In the previous few months, Nifty has created a long trail of lower-lows (LLs) and lower-highs (LHs). Previous week it took support from the Support Zone. It is still trading below all it’s key moving averages - 21 DMA, 50DMA and 200DMA. Keep an eye on, if the Index breaks above its range high (22650 level), it can reclaim it’s short/mid term MA (21DMA & 50DMA), that would be a positive sign!
Nifty Midcap100 Index: Price Chart on ‘daily’ timeframe. (Source: TradingView)
Index has formed LLs and LHs in the past couple of months. There is no change in the trend yet. It is trading below it’s key moving averages- 21DMA (blue), 50DMA (red) and long-term 200DMA (orange).
Nifty SmallCap100 Index: Price Chart on ‘daily’ timeframe. (Source: TradingView)
Index has formed LLs and LHs in the past couple of months. However, it looks there’s a ‘Reverse Head & Shoulder’ technical pattern, in the making. Look at the left-shoulder (LS), head (H), and right-shoulder (RS) is still being formed. This is a strong reversal pattern, and suggests change in the trend. If the Index breaks above the neckline (around 15500 level) and preferably above the resistance zone near 16000 level, the trend reversal pattern will be confirmed. Keep an eye here, as any breakout on the upside can take the Index to retest its 200DMA.
MARKET BREADTH OF INDIAN STOCK MARKET
Market Breadth at the end of Week 11, 2025 (Source: ChartInk)
Stocks trading above 21DMA: reduced from 34% to now 18% as small/midcaps faced selling pressure due to volatility in the US stock market.
Stocks trading above 50DMA: only 11% stocks closed the week above their 50DMA. This number was 15% previous week.
Stocks trading above 200DMA: has decreased from 17% (previous week) to now around 14%. This means, still the majority stocks trade below their long term moving average line (200DMA) as the major indices are also trading below their 200DMA.
PRECIOUS METALS
Why is everyone now talking about Gold and Silver? Breakout!
Since both the precious metals have given a breakout from their consolidation (base), it is come to the spotlight of everyone. As Traders, finding low-risk entries become difficult after the breakout. Look how we spotted when it offered low-risk entry:
Gold Futures (MCX): Price Chart on ‘daily’ timeframe. (Source: TradingView)
The Index breaks out from the recent consolidation of 1 month. The price action looks very bullish. Look closely how the index has consolidated before breaking out to higher territories. Gold Index has a history of outperformance during phases of high volatility in the global equity markets. In this FY, the Gold Index has given return of 28%, till 14th March’25.
Silver Futures (MCX): Price Chart on ‘daily’ timeframe. (Source: TradingView)
The Silver Index breaks out from the VCP pattern (consolidation with contraction in volatility on the right side). It is trading above the 1,00,000 mark. Did you notice Silver is following the mother chart of - Gold? Both the precious metals will continue to outperform as long as volatility remains high in the global equity markets.
“As a Trader, these global cues indicate that volatility will remain high in the US market. And, it’s overarching influence will certainly make things difficult for Indian stock market. Though the periods of high market volatility offer some of the best opportunities, they act like a double-edge swords. Therefore, it is important to remain cautious and defensive! Act only when the market turns favourable. ”
As per our Trading Rules, that are based on the experience of legendary traders, when the major indices are trading below it’s 200DMA (long terms average), it is a ‘No Trade Zone’ for traders. No sustained move is expected till then, rather it can do more damage by multiple chops. Risk Management is our priority! We had discussed about this ‘Rule’ more at length in our earlier Week-4 DeepDive post (click here to read). Again a reminder - ‘nothing great happens when indices/stocks trade below 200DMA’.
Build your Watchlist:
Stay on the sidelines, and focus on building a watchlist of stocks. How can you find that? Stock which are trading above 200DMA, preferably above 50DMA, are the ones where you should focus. When the Indices improve and resume the uptrend, these are the stocks that can likely give a solid runup.
Find leading stocks from leading sectors/themes. For clue, look for sectors trading above 200DMA, and find the top stocks from these sectors.
For instance: the HVAC theme (Heating, Ventilation and Air Conditioning) is showing great strength in the current market volatility. And there are good names showing high relative strength like - Blue Star, Amber, PGEL and KRN.
As long as Indices are trading below all it’s key MAs, it is prudent not to initiate any new trading position(s). Till then, build a WATCHLIST of potential leaders!
Corrections & Bear Phases are the best time to find ‘Next Potential Leaders’ as leading stocks show relative price strength and you can filter them through the following clues:
(i) leaders fall less than the major indices,
(ii) leaders bottom out before the major indices,
(iii) leaders show sharp recovery as major indices see buying/green days,
(iv) leaders start emerging as indices consolidate before/after reclaiming their MAs i.e. ideal buy ranges for a positional/swing trader.
If the major indices improve in coming week(s), you can likely find low risk entries in stocks from your watchlist. Always stay where strength is! Just wait for the overall environment to turn favorable, before you begin your Trading Hike!
That’s a wrap! See you in the next week’s DeepDive Report.
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