Weekly technical Analysis for week ended 6th March 2010.
Nifty opened on a strong note and stayed strong throughout the week. Nifty virtually closed at highest point during the week indicating that the bulls strong at-least for the short term. One of the positive features of the current move is that the break out( on budget day) was on high volumes the following rises were also on high volumes indicating that the rise might be on genuine. One of the noticing features of the current move is that nifty has successfully closed above the 100 day EMA which is clearly giving an indication that the bulls are in strength as of now. It has also moved above the 50 day EMA and also 15 day EMA has moved above 100 day EMA and is in process of moving above 50 day EMA indicating that bulls are gaining strength. So as far are technical’s are considered it appears that bulls appears to have gained upper hand and would try all means to take it forward as not it is nearing the resistance zone near 5180-200 levels where the trend line from the May 09 lows is there. So we can expect that trend line to offer good amount of resistance on upper side movement of market. If it is taken over then we can see the market towards 52 week high. So just wait and watch.
Nifty opened on a strong note and stayed strong throughout the week. Nifty virtually closed at highest point during the week indicating that the bulls strong at-least for the short term. One of the positive features of the current move is that the break out( on budget day) was on high volumes the following rises were also on high volumes indicating that the rise might be on genuine. One of the noticing features of the current move is that nifty has successfully closed above the 100 day EMA which is clearly giving an indication that the bulls are in strength as of now. It has also moved above the 50 day EMA and also 15 day EMA has moved above 100 day EMA and is in process of moving above 50 day EMA indicating that bulls are gaining strength. So as far are technical’s are considered it appears that bulls appears to have gained upper hand and would try all means to take it forward as not it is nearing the resistance zone near 5180-200 levels where the trend line from the May 09 lows is there. So we can expect that trend line to offer good amount of resistance on upper side movement of market. If it is taken over then we can see the market towards 52 week high. So just wait and watch.
Market has moved above the 61.8% of the total fall from 5300 to 4675, giving an indication that nifty might attempt at 80% retracement which happens to be at 5180. One of the points to be noted here is that except in January 2010 nifty has faced considerable resistance at 5180 levels and currently the resistance is also placed at 5183 so this is the levels which might offer very very good resistance.
Positives for Nifty:
• Market is above 200 day EMA.
• Market is above 15 day and 100 day EMA.
• Daily MACD is in buy mode.
• DMI is given buy signal during the week indicating strength of bulls but DMI is moving indicating that bulls are not as strong as they are ought to be.
Negatives for nifty:
• Nifty is below 50 day EMA
• Weekly MACD and TRIX are still in sell mode.
Elliotte wave
As per Elliott wave it appears the trend might has turned down and we might be heading down wards. I have indicated in my earlier monthly analysis the probable alternatives and in the next week I would again give the probable formation and structure and the targets. But today I would be giving the minimum targets which markets have to achieve if the reversal is correct. As per the Elliott wave if market is correcting the entire rise from March 2009 then we have the minimum target of 4650 and in my view it should be 4246 which is the 38.1% retracement. If we seen historically nifty has corrected anywhere between 50 to 61.8% when the nifty has corrected after substantial rise. so the total rise of nifty is around 2800 points so we might see a fall of either 1400 points or 1730 points thus giving a target of 3900 and 3500 so we have still a way to go before market reverses.
Directional Momentum index – (DMI)
Current +D1 has moved above –D1 indicating that bulls might has slowly coming into the market and they are refusing to go down but the DMI which shows the strength of the trend is moving down indicating that they are not as strong as of now as they appears to be.
Pivot Point Trading Strategy
Weekly pivot placed at 5047 and if nifty maintains above that we have chances of seeing 5159 and 5230 if it moved below 5047 then we have chances of seeing 4976 and 4864. So trade accordingly.M.Sri Mahidar
Sunday 7th March 2010, Time 19.32 IST
Trend is friend
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