Weekly technical Analysis for week ended 11^th May 2013

All of you might be wondering that I am a perennial bear, as I have been projecting the bear phase from long. But that is not the case I have been constantly saying that whatever might be the case the price is the king and the price as per chart is indicating the upside for the market and it has been making highs. As has been pointed out in the last weeks update, I have indicated that as per the time lines which we apply while arriving at the trend whether up or down are pointing not a good story for the bulls in medium term as the retracement time is more that the time it has taken to fall. This is clearly pointing out that even though the market is moving up it does not have strength as it is taking more time to retrace the fall. All this is pointing out towards a imminent fall which would formalize over the period of time. When it would take place only market would indicated but the final fall has to come and when it comes it should be more devastating than that we have seen in recent times. We have to wait patiently for that. Till that time as I always point out what ever be the indication of the market price is the king and it would always enable to be with the market either up or down. As of now it is pointing towards moving up and is moving up so we have to be with that even though the price patterns are indicating that we might be nearing the top so till the market reverses we have to be long with tight stop loss.

Today I would be indicting or explaining the Demark indicator developed by the Thomas indicator, it is on of the powerful pattern as it takes into account only the price only and not any other. its not like any other indicator, it is not indicated or derived from the price it is price only. there are some sequence of prices and some rules for the same and when the price matures it clearly indicates reversal. But in this case also we have to wait for the price to reverse and then take reverse position.

As per this indicator we have completed TD sell set up meaning that we are in for a sell signal and we have clearly completed that pattern both in Bank nifty and also nifty. Whenever there is co-relation between these two indicators that we can hope for a powerful reversal. The patterns have been completed in monthly charts over a period of 5 year which would be a powerful signal for the market. As its spread over five years I am sure that we are somewhere near major top and when ever it reverses we can hope for a very devastating fall which would take all the market participants by surprise I am pointing towards a medium term trend not the immediate trend. So brace for market to fall over period of six to 12 months. And once that happens we can expect a powerful bull market which should last for years to come.

The first chart is that of nifty and the second chart is that of bank nifty. Both these indicators have completed the pattern and now once they close below the 13^th bar we can hope for a reversal and expect the market to go down very fast.  Banks nifty should move below 11800 and nifty should move below 5930 then only the pattern would confirm the reversal till that time we have to be either long or stay away from the market. In nifty we can place stop loss order at 6200 and bank-nifty at 13200. As the patterns have formed over a period of 5 years I am giving weightage to the pattern. Even on daily basis I have applied that same for last one year and every time I have benefited a lot and only its failed for one time and in that stop loss was taken out and saved my capital.

 

 

M.Sri Mahidar

Trend is Friend
Celebrate Life
Sunday 12^th May 2013 time 11.53

nifty weekly update for 28th April 2013

Weekly technical Analysis for week ended 27^th April 2012

I am writing this weekly update after a long time, as I have myself decided to stay away from the market updates and now I have decided to follow the market.

During the period which I was away from the market (I was closely following the same) nothing much seems to have happened market is nearly as the same levels as on that time. During the week which was truncated week the market opened on a strong note and started to moved up and continued to move up. This week was also the derivatives settlement weak, so in the coming weak we might see a move but the coming weak also have big event of RBI credit policy and market might not do much till that event happens. But we have to discuss technical right.

Now the question comes whether the up move from the January 2012 is a bull market or a up move in the bear market. that market has taken 59 weeks from the high of 6335 in November 2012 to the December 2011 low of 4531. From there on the market is moving in a up move and currently it has completed 70 weeks and would be entering 71 weeks and we are nearly 10% from the top so the retracement( up move) has taken 20% more that the fall and we are still far away from the high. So considering this the up move cannot be considered as a bull market up move. To be a bull market the last was should be retraced in 50-60% of the time to be power full even if its just equal it better but currently the time period is far more that that is comfortable for the bulls. So when ever the down move comes it would be very violent.  Will that happen or not we have to wait and watch. The market is maintaining above 200 day EMA so bulls are still favor of up move of the market and long term investors are still in the market.

  

The above chart is a weekly chart and the fall took 59 weeks and the rise has till now into 71 weeks and we are still far away from the top.

If you apply the longer time frame from the high of January 2008 the market has fallen from January 2008 of 6354 to a low of around 2250 in October 2008 in nearly 43 weeks( or nearly 10 months) and now nearly 4 and half years have completed so we have completed nearly 54 months and till now we are far away from the top and in this period we were not able to move above the high. So we have nearly completed 5 times the time period and still not able to move above the high. So still I can say that we are still not in a bull market all these are uptrends in the bear market and it appears that till the final fall happens we might not be seeing a change is sentiment. The up moves are only a relief rallies.

I have given the time period elements in this weeks update and I would be providing the Elliott wave updates from the next week onwards or during the week.

M.Sri Mahidar

Trend is Friend
Celebrate Life
Sunday 28^th April 2013 time 20.34