Archives : CORRECTION INTENSIFIES - 20/03/2013.

CORRECTION INTENSIFIES - 20/03/2015. 

SELL ON RISE.

After moving sideways for the first part of the week, the Correction intensified on the last two days of the week as the market breached important support levels and continued its journey on the downside. This time the correction seems to be on track to test the long term pattern support of Broadening Ascending Wedge at Nifty 8412, which is a make or break level from long term point of view. The short term and medium term trend continues to be down as every rise is being sold into. The Nifty continues its southward journey towards achieving Rising Wedge target of 8286-7881.

 

 


CORRECTION INTENSIFIES - 20/03/2015. 

SELL ON RISE.

After moving sideways for the first part of the week, the Correction intensified on the last two days of the week as the market breached important support levels and continued its journey on the downside. This time the correction seems to be on track to test the long term pattern support of Broadening Ascending Wedge at Nifty 8412, which is a make or break level from long term point of view. The short term and medium term trend continues to be down as every rise is being sold into. The Nifty continues its southward journey towards achieving Rising Wedge target of 8286-7881.

TECHNICALLY SPEAKING.

Sensex opened the week at 28546, made a high of 28978, low of 28209 and closed the week at 28261. Thus it closed the week with a loss of 242 points. At the same time the Nifty opened the week at 8656, made a high of 8788, low of 8553 and closed the week at 8570. Thus the Nifty closed the week with a loss of 77 points.

On the daily charts, both the indices have formed an Opening black body Marubuzo in line with the current downtrend. On the weekly charts, both the indices have formed a small black body candle with a longer upper shadow which indicates selling pressure at higher levels. Thus daily as well as weekly candlestick patterns are suggesting continuation of bearishness in the near term.

The immediate Correction levels have to be considered of the rise from Sensex 26469 to 30024 and Nifty from 7961 to 9119. Thus the relevant Correction levels are placed at 28666-28247-27827 for the Sensex and 8676-8540-8403 for the Nifty.

Both the indices are well on its course to test the Bearish Rising Wedge bottom support which is at Sensex 27884 and Nifty 8412. This level coincides with the 61.8% Retracement level (Sensex 27827 and Nifty 8403), thus forming a confluence Support zone between 27884-27827 for the Sensex and 8412-8403 for the Nifty. This will be a very critical support zone for the market as a breach will pave the way for bearishness even in the long term timeframe.

Last week both the indices completed a Bearish Rising Wedge pattern and now the indices are headed lower. The Rising Wedge pattern target falls at 27293-26129 for the Sensex and 8286-7881 for the Nifty.

This week the market continued to test both the short term average of 20dma (Sensex – 28918 and Nifty – 8768) as well as the medium term average of 50dma (Sensex – 28772 and Nifty – 8704), but was unable to overcome them. However, both the indices continue to remain well above the long term average of 200dma (Sensex – 27129 and Nifty – 8141). Thus the trend in the short term and medium term timeframe has turned bearish whereas the trend in the long term timeframe continues to remain up.

MACD and Price ROC are both negative and continue with their Sell signals. RSI (40) continues to indicate bearish momentum. MFI (46) has given a fresh Sell on Friday suggesting money outflow. Stochastic Oscillator %K (7) continues to remain below %D and hence it is in Sell mode. ADX has moved lower to a level of 14, which suggests that the prior uptrend has lost all of its strength. Directional Indicators have given a fresh Sell signal on Thursday as +DI went below –DI. Point of concern is negative divergence on the daily as well as weekly charts. Thus majority of Oscillators are suggesting a bearish bias in the near term. 

Option data suggest highest Call Open Interest buildup has shifted to the strike of 8800, whereas the highest Put build-up is at the strike of 8500. Thus Option data suggests a trading range with support coming in at 8500 and resistance around 8800.

Trendline Resistance for the Sensex is at 29584. Trendline Support is at 28187.

Trendline Resistance for the Nifty is at 8979. Trendline Support falls at 8509.

INDEX LEVELS:

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

8236

8356

8470

8570

8677

8788

8913

Sensex

27203

27512

27915

28261

28584

28978

29269

LAST WEEKS RECOMMENDATIONS:

STOCK

Reco. Price

Tgt

Reached

Lot Size

Profit

UltraTec

2946

2872

2835

125

Rs.13,875

LiCHsg

447

421

440

500

Rs. 3,500

Sell Arvind

286

272

273

1000

Rs.13,000

TataGlob

155

148

149

2000

Rs.12,000

IndCem

96

91

91

4000

Rs.20,000

Total

Rs.62,375.

THIS WEEKS RECOMMENDATIONS:

STOCK

CMP

SL

Tgt-1

Tgt-2

Sell Maruti

3623

3695

3510

3395

Sell ICICI

319

325

310

300

Sell TataMtrDvr

327

334

316

305

Sell Bhel

246

252

236

225

Sell TataGlobal

150

154

143

136

WATCH OUT FOR:

Tata Global

Disclaimer : The recommendations made herein do not constitute an offer to sell or a solicitation to buy any of the securities mentioned. No representations can be made that the recommendations contained herein will be profitable or that they will not result in losses. Readers using the information contained herein are solely responsible for their actions. Information is obtained from sources deemed to be reliable but is not guaranteed as to accuracy and completeness.

Copyright © 2000 - 2018 Jatin Sanghavi. All rights reserved.
No part of the material on this website may be reproduced or distributed in any forms or by any means, electronics or mechanical without the written permission of the author.
Sitemap