This is in the mind of many people that how we do the stock market prediction for the next day. This is the common query because when a beginner comes in the market then he wants to know where the market will go so he can make good decisions on the basis of that. Let’s learn how you can do that.
Table of Contents :
First of all it is not that much compulsory to find the movement for the next day because we just need to learn the market trend as a trader and trade with the trend. Because chances of success are more of the persons who follow the market not predict.
But for more clarity lets learn some methods that can help you find the levels of Market that what is support or resistance and from where can market bounce or where we can get profit booking.
1. Charts :-
The first methods to predict the movement of Nifty and Bank Nifty is chart study. Charts tell us almost the clear picture if we have a good experience studying them. In charts if stock is near support and market is in oversold condition then we can assume that Nifty will bounce from here and its vice versa is with resistance. Basically we can say Price Action is the good method to study for the stock market prediction.
The breakouts and breakdowns also help us to find the momentum of Nifty. If Nifty or Bank Nifty breaks the resistance then there are high chances that it will give a good rally. And if it gives a breakdown of support then chances of fall are more. And if you want to predict the market just for the next day then you have to do this on the 15 minute chart. 15 minutes chart is more reliable than any other time frame for intraday stock market prediction.
2. Option Chain :-
If you have been working in the market for some time then you have definitely heard about Futures and Options. These options also help us to predict the market in the near term. In options if Open Interest of Out of Money Put Selling is more than those levels work as support. Same way if Call side Open Interest is more then it will act as resistance. But for that we need some experience.
One important point is that if options data and charts say the same thing then it’s ok. But if the chart is telling something different and options data is different then the chart will be right because options data can change within minutes. In the stock market prediction options data is just used to have more conviction and double confirmation. Mostly this data is used to predict the intraday or next day market movement not more than that.
3. Put Call Ratio (PCR) :-
PCR is our own method to predict the momentum. But it can’t be used daily. Sometimes when the market is overbought or oversold we can find that with this. If PCR is below 0.65 then it tells us overbought and a small bounce we can expect from there. This bounce can remain for one or two days. In the same way if it is above 1.60 then it indicates overbought and in the short term we might see profit booking there.
If PCR is near 1 or some points above or below then it indicates nothing and we should not try to do the stock market prediction then. Also one point to note that it is not very relevant on Expiry day. But to increase the probability of success with PCR we should use Price Action because if we take decisions only on the basis of PCR then chances of failure are more.
4. Experts Opinion :-
Consulting with experienced traders, financial analysts, or investment advisors who have a deep understanding of the market can provide valuable insights and perspectives. While experts may not always be accurate in their predictions, their knowledge and experience can be valuable in forming your own opinion.
But remember one thing that you should not follow these experts blindly. On TV everyday a lot of experts predict the market by saying Stock Market Today. We should take the opinions of one or two experts which we believe more. Even when we believe these experts we should follow the market and should make our own opinion on the basis of that. Never take decisions only on the basis of experts only.
5. Sentiment Analysis :-
Study of the market sentiments is very important for the stock market prediction. This method involves assessing the overall sentiment of investors and traders through various means, such as social media sentiment analysis, surveys, and market sentiment indicators. By understanding market sentiment, you can gauge whether the market is bullish (positive) or bearish (negative).
Sentiments have a big role in the market, mainly when we are talking about the prediction of a very short term in the market. Bad or good news can change the sentiments of the market for a very short term and it can impact market movement. So, when we want to predict the market for intraday or for the next day then we should take help of market sentiments to know the movement of the market.
6. Event Analysis :-
Significant events, such as earnings releases, product launches, regulatory changes, or political developments, can have a substantial impact on market movements. By staying informed about upcoming events and analyzing their potential implications, you can make predictions about how the market might react. We should keep focus on important events because these events help us to predict the market.
Keeping an eye on key economic indicators, such as GDP growth, inflation rates, employment data, and interest rates, can provide valuable insights into the overall health and direction of the economy. Changes in these indicators can impact market sentiment and influence future market movements. We have recent examples of FED interest rate events.
So, these are some methods which we personally use to find the momentum of Nifty or Bank Nifty and predict the market.
Learn More :
Thank you for reading Buffett Money’s guide on the Stock Market Prediction. To keep learning and developing your knowledge of financial analysis, we highly recommend the additional resources below:
- Penny Stock
- High Growth Stocks
- Dividend Yield Stocks
- False Breakout Stocks
- Fundamentally strong stocks
- AI impact on Algo Trading
- 5 Best Stocks
- Averaging Down Strategy
This is just for education purpose. Do your research or consult your financial advisor before investing.
Thank You
Happy Investing🙂🙏
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