Weekly technical Analysis for week ended 9th October 2010.
Nifty opened on a strong note and there after moved up and made a new 52 week high at 6223 and there after started to move down and closed at 6103 virtually at the low of the week. After nearly five weeks of continuous rise nifty has formed a black candle on weekly charts. This is indicating weakness, but bulls would not have any problem till 5900 is held. Technically not much has not happened during the week but we would try to analyse the same. By this week we have completed 20 weeks continues rise from the lows of around 4700 levels. As per Fibonacci we still have one week left for the market to reverse. As has been indicated earlier we have completed 19 months of continues rise by September and we are on our way to complete next Fibonacci of 21, so we have all chances of market rising for another month excluding this month of October. As per this we are into a market top somewhere in end of December and January 2011.Historically January tops are not good signs for bulls we have to see whether the market tops during this time also or not. So keep a close watch from December end to January 2011 end.
i have indicted last week that market in its entire rise from march 2009 has not closed at two months low which indicates that when ever this happens bulls would have difficult time to hold so till that time bulls need not worry and the market would continue to move up. Please not that it should be two months low close and not two months low. The point which ahs to be noted that when ever this happens it would be fast and swift and it would not give any time for us to apprehend but we have to be watch full every time.
It can be seen from the above chart that nifty has broken the one and half months trend line. Market has to immediately move above this trend line otherwise it has chances of moving towards 6000 levels and there after make an attempt to make a new high. It appears the markets would try to make a new high by the time of Diwali. We cannot say anything sure about the market but it appears to be so.
§ Market is above 200 day EMA.
§ Market is above 50 day or 100 day EMA.
§ Weekly MACD is in a buy mode.
§ Weekly RSI is at around 80 levels indicating over bought levels.
§ + D1 as moved above -D1 indicating that bulls have gained upper hand. Weekly DMI is moving higher and has not moved above 20 presently at 24 indicating that on weekly basis the markets are gaining upper hand and any correction should be taken as an opportunity to go long in the market.
Negatives for nifty:
§ Daily stochastic is in over bought zone and has given a sell signal and moving down, and Weekly stochastic is also in sell mode.
§ The rise is on –ve divergences with MACD histogram and also RSI.
Directional Momentum index:
+D1 is above –D1 and is moving up and also DMI is place at above 43 so we might see very very swift movement in the market. Also DMI has moved above +D1 indicating that bulls are gaining in confidence and we can see healthy movement in coming weeks.
M.Sri Mahidar
Sunday 10th October 2010, Time 18.37 IST
Trend is friend
No comments:
Post a Comment