Market Status

 

Let us analyze the story so far once again; this time, with the help of equidistant parallel channels.  From mid Oct 2009 to Sep 6, 2009, NIFTY moved precisely through the mid line “B”. It then broke out to touch the first parallel line “A”. On third week of Nov, NIFTY took support, at line “B”, which was the resistance line over one year. After a quick pull back, it broke down below “B” by Jan First week. Now, it is definitely heading towards line”C”, and it that does not hold; line “D”. Line “D” is far away and as this is a weekly analysis, we will avoid line “D” at the moment. The line “D” at the moment points to 5150-5200.

 

Now, looking at the Daily chart (Not shown), the next two supports are seen at 5400, 5250 and 5150. Note that these values are the closest round figure and not the exact value.

 

Looking back to the weekly chart once again, you can see, the importance of 5400 region, as this was the resistance from April to Aug 2010. Hence this region is broken down; it might be a matter of hours to get close to “C”.

 

All these indicate that, the coming week might be fiercer.

 

These days, Indian Markets were falling and other global markets were holding. It is now the turn of rest of the global markets to join this southbound journey. As you already know, except India, most of the markets across the globe follow American Market. Now look what has happened in DOW, this Friday. In a single day, DOW has dropped below the four day’s low (notice BD). Most of the big moves are preceded by a large move. In Dow, by 11000, it broke out with a large move, as shown in “1’. Now that, from 12000, it has done it once again as shown in “2”. This is the first indication of Smart Money getting out. So, expect global turmoil too in the coming weeks. Will this add fuel to the fire in Indian Market? I think so. But, in stock market anything can happen at any day. So, we will wait and see.