Bear Wall = 200 Day Moving average

Most of the market analysis fails because it is focused on what the market *should* be doing, rather than on what it *is* doing.

Guest Post: Deepak Singh Market Analyst, State of the Market

There is a saying - "Bulls live above 200 day moving average whereas Bears live below 200 day moving average". It means above 200 day moving average, bulls buy the dips and defendsupport levels; whereas below 200 day moving averages - bears eat up the rally and defend resistance levels.

Nifty on Friday managed a breakout above 5070 and closed at 5111 just below 200 day moving average of 5150. Now, its decision time for market - Move up decisively OR Move down decisively OR Consolidate some more between 50 day moving average and 200 day moving average.

It is not the case with the Indian market alone. US indices are also just around key resistance levels example - 12800-13000 on Dow Jones; and 1400 on S&P 500. Both indices will have to break decisively above those levels, close and stay there for couple of days to give market participants a comfort that indeed - worst is over and may be a new bull run is about to emerge. Fundamentally such a scenario looks little remote, but that does not mean that breakout cannot happen.

I guess the description from Colin Twiggs sums up the current status very well -

The Dow retreated on Friday morning but rallied towards the close, ending near the day's high at 12900. Failure to react to bad news is a bullish sign — as is a short retracement at the resistance line (12800). Low volumes, however, indicate that the rally does not result from buying pressure, but rather from the absence of sellers — warning us to proceed with caution.

If you are bull, the following description from Maurice N. Walker will please you -

The bull market is not dead, nor is this a bear market. This bull market was only faking its own death, perpetrating fraud against those who are short this market. Who will ultimately pay the price for this deception?

As a market watcher, I am just confused as you may be. As a trader, it is much better to have an opportunistic mindset than either a bullish or bearish