Technical Analysis,Research & Weekly Outlook
(May 21 to May 25,2012)
Nifty-EOD Chart (18-May-2012):-
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1- Impulsive Wave-1 completion at 5629.95 on 22-02-2012.
2- Corrective Wave-2 continuation.
3- Breaking down confirmation after 9 sessions sustaining below Long Term Trend decider 200-Day SMA.
4- 61 Sessions correction in Falling Channel(Bullish Flag Formation)
5- Support at the bottom of Lower Falling Trend Line of Falling Channel on 18-05-2012
Conclusions from EOD chart analysis
All the trends are down and Indian markets are in the grip of Bears. Long Term Trend turning down confirmations through 9 sessions sustaing below 200-Day SMA during on going correction. Nifty got support at Lower Falling Trend Line of Falling Channel on 18-05-2012 anf fast recovery seen also.
4 Supports & 4 Resistances in Last 10 Days
Nifty-Intra Day Chart (May 07 to May 18,2012):-
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4 Supports of last 10 sessions are as follows:-
S1- 4790-4807
S2- Double Bottom support at 4852.
S3- 4840-4860
S4- 4877-4907
4 Resistances of last 10 sessions are as follows:-
R1-4904-4922
R2-4936-4953
R3-5003-5036
R4-5065-5125
Conclusions from 10 days intra day chart analysis
Strong recovery after gap down opening on 18-05-2012 as well as crossing all 3 previous supports because gap down opening was the result of Global markets crash. As market slipped after good selling therefore 4 resistances also developed in last 10 sessions.
Conclusions (After Putting All Studies Together)
All trends are down and Indian markets are in Bear phase and multiple resistances are at higher levels therefore complete consolidation is required for crossing and sustaining above resistances. Nifty has to face following resistances also after crossing above mentioned 4 resistances of on going 61 sessions correction:-
1- Resistance between 5190-5305
2- Resistance between 5318-5337
3- Resistance between 5357-5377
4- Resistance between 5418-5487
5- Resistance between 5588-5625
Fibonacci Retracement Levels of previous rally(4531-5629) are as follows:-
13.0%- 5486(Tested)
23.6%- 5369(Tested)
27.0%- 5332(Tested)
38.2%- 5209(Tested)
50.0%- 5080(Tested)
61.8%- 4950(Tested)
70.7%- 4852(Tested)
76.4%- 4790(Got support at 4788.95 on 18-05-2012)
78.6%- 4765
88.6%- 4656
76.4% Retracement completed on 18-05-2012 and after that sharp up move was also seen because Nifty got support also at Lower Falling Trend Line of Falling Channel on 18-05-2012. Nifty got support between 4790-4907 in last 5 sessions therefore expected that Nifty will firstly trade between this range in the beginning of next week and sustaining above this range(4907) is must for any decisive up move. As all the trends are down therefore until Nifty will not sustain above 200-Day SMA till then only Pull Back rally will be considered. Breaking down below 4790 will be confirmations of fast down moves to test following supports;-
1- 4635-4663
2- 4602-4624
3- 4560-4590
As last 5 sessions support range(4790-4907) is most crucial for deciding next short term/Intermediate term trend therefore firstly watch its break out for above mentioned next moves confirmations.