Weekly Analysis- 22-11-2010 to 26-11-2010
Following lines were told in the last conclusive paragraph of last week weekly:-
"Only minor pull back rally possibility in the begining of week otherewise finally testing 5932 and breaking down of 5932 as well as intermediate term trend turning downward possibility is high in the coming week"
Nifty broken down 5932 "by force" last Friday and it will be clear from following break out moves timings:-
"Nifty was trading '5970 at 02:25 pm and slipped to 5864 at 03:12 pm'. Nifty 'lost 106 points in 47 mintes in which 65 points down was in 14 only minutes'" Nifty not only broke 5932 by force but also 'closed 42 points below it at 5890'.
On going up move started on 31-08-2010 from 5349 which terminated on Muhurat trading day at 6339 after gaining 990 points. Nifty traded 42 sessions within 5932-6339 and got 3 times support near 5932 within this move. 42 sessions upmove neutralised last Friday after following distribution patterns:-
1- Rounding Top Formation
2- Intraday Charts selling patterns.
3- Down move in Falling channel.
4- All rising trend lines broken down
1-Technical Position Daily Chart-
Four Supports Broken in a day by Force on Closing Basis on 19-11-2010 and Nifty closed 69 down from form previous 42 sessions lowest closing:-
2-Nifty Line Chart-
Supports Ranges:-
Next Supports Ranges of 990 Points Rally(5349-6339) are as follows:-
1- 5835-5865
2- 5780-5805
3- 5580-5640
4- 5475-5500
5- 5420-5445
6- 5350-5370
3 Next Supports Ranges Chart-
Resistances Ranges:-
Good selling started from Muhurat session and daily selling seen. Following resistance Ranges shown in Last 10 Days intraday charts;-
1- 5950-6015
2- 6080-6120
3- 6180-6195
4- 6250-6320
4-Resistances in intraday Chart-
Fibonacci Retracement Levels:-
Rally terminated at 6339 and will correct whole rally which started from 5349 on 31-08-2010. On going 990 points rally will correct according to following Fibonacci Retracement Levels:-
13.0%- 6210
23.6%- 6105
27.0%- 6071
38.2%- 5960
50.0%- 5844
61.8%- 5727
70.7%- 5639
76.4%- 5582
78.6%- 5560
88.6%- 5461
5-Fibonacci Retracement Levels Chart-
Weekly Indicators and Averages Analysis:-
Almost "Marubozu Candle" formation in last week after "Engulfing Bearish" Candle in the previous week. 2nd Long Red weekly candle clearly confirming weakness.
1-Weekly Averages- Short term Weekly averages are above longer term averages.5-week,21-week EMA are flat while ,34-week,55-week EMA heading toward upward direction. Nifty moved below 5-week EMA and confirming weakness.
2-Weekly Bollinger Band- Complete 7 weeks distribution pattern near the upper band and slipping toward Middle Band confirming weakness and more down moves possibilities also.
3-Weekly MACD- MACD line is marginally above Average line in positive zone and MACD line is sliding also. MACD has not downward intersected Average line and divergence is only 6.431 as well as both lines are in kissing positions therefore MACD has to be watched because it will give next big move confirmations. MACD downward intersection of Average line will mean big down move confirmation and moving up without intersection will be up move confirmation after completion of correction.
4-Weekly ROC- Sliding in positive zone and little above equilibrium line therefore showing weakness signals.
5-Weekly RSI- Sliding in positive zone and little above equilibrium line therefore showing weakness signals.
6-Weekly Slow Stochastic- Both lines are at equilibrium line after slipping from overbought zone therefore showing weakness. As it is used to test oversold zone after slipping from overbought area therefore showing some more down moves possibility.
7-Weekly William %R- Moving down above equilibrium line after slipping from overbought zone therefore showing weakness. As it is used to test oversold zone after slipping from overbought area therefore showing some more down moves possibility.
6- weekly Indicators and Averages chart-
Daily Indicators and Averages Analysis:-
1-Averages- Nifty is above 55-Day,200-Day EMA and below 8-Day,21-Day EMA. 8-Day intersected downward 21-Day EMA. Nifty tested 55-Day EMA and closed below it last Friday and sutainability above or below 55-Day EMA will give next good move confirmations.
2-Bollinger Band- is at lower band after forming complete selling patterns at upper band. As at lower band therefore indicating minor up moves possibilities.
3- MACD- Both lines are sliding ,MACD at equilibrium line while Average line is above equilibrium line. Divergence increased in both lines therefore indicating small upmoves.
4-ROC- Entered into oversold zone therefore indicating small up move possibility. As no divergence therefore no up move confirmation.
5-RSI- Sliding above oversold zone therefore indicating some more down move possibility.
6-Slow Stochastic- Both lines slipped into oversold zone therefore indicating very short term upmoves possibility.
7-William %R- Slipped into oversold zone therefore indicating very short term upmove possibility.
7- Daily Indicators and Averages chart-
Conclusions (After Putting All Studies Together):-
Two Intermediate term correction signals in last week:-
1- Indian markets retraced after complete sellng patterns at higher levels and closed below 55-Day EMA(5980).
2- Nifty closed below intermediate term bottom(5932)
Nifty sustaining below 5932 in coming week will be confirmaton of and intermediate term down trend and it has to be received because last session sharp decline may be result of PM resigning possibility rumours also and regarding it some reports were seen on Business Channels also.
As good selling patterns at higher levels in Indices and many pivotal stocks `therefore I was non stop telling for the possibility of breaking down of 5932 and it happened, Nifty sustaning below it will mean Internediate term correction confirmation. Then next possibilities will be:-
1- Down move from 3 weeks to 3 months from the begining of move.
2- 200 Day EMA testing possibility which is today at 5510.
Weekly indicators are confirming down move while daily indicators indicating small up moves because very short term indicators moved into oversold area which may be seen in the begining of week. If Nifty sustains below 5932 in the begining of week then it will be more down confirmation and Nifty sustaining above 1st resistance range(5950-6015) will be correction completion confirmation.
As good selling patterns at higher levels in Indices and many pivitas stocks therefore expected that Correction of 990 Points Rally will be seen according to above mentioned Fibonacci Retracement Levels. Also expected that Nifty will finally sustain below 5932 after fresh selling in the coming week and weekly closing will be Red. Complete consolidations requires for any up move and until that will not be seen till then upmoves will not be considered. At present sustaining above 6015 is upmove confirmation point.
