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Bears back with honed weapons - 4700 may be tested
Sensex (16372) / Nifty (4906)
As stated in our previous report, the negative crossover in
Daily "RSI - Smoothened" and "ADX (9)" indicator reinforced
massive selling pressure on the violation last week's low of
17096 / 5142. Thus, we witnessed a sharp correction in the
last four consecutive sessions. Financial uncertainty across global
indices clearly hurt sentiments in our markets. Despite the
positive weekly opening on Monday's session, indices slipped
below the psychological level of 16700 / 5000. On the sectoral
front, the Realty, Capital Goods, Power and Oil and Gas sectors
contributed heavily into this week's fall. The Sensex ended with
a loss of 4.78% and the Nifty lost 5.09%, vis-à-vis the previous
week.
Pattern Formation
Momentum oscillators viz. the RSI and the Stochastic on
the Weekly chart are negatively poised.
We are witnessing a negative crossover of "3 & 8 Weekly
EMA".
The stochastic oscillator on the Daily chart has given a
positive crossover.
The Daily chart exhibits a "Bullish Hammer" pattern at
78.60% Fibonacci Retracement level. This pattern needs a
confirmation.
Future Outlook
Markets registered a Weekly low of 16165 / 4845 and managed
to give a minor bounce on Friday's session, which pushed indices
higher to close marginally above 16300 / 4900 levels. We are
now observing that the momentum oscillators and "3 & 8 EMA"
on the weekly chart are negatively poised. Thus, if indices sustain
below the 16165 / 4845 level, further weakness is expected in
the coming weeks. This may result into a sharp decline to test
crucial and important support level of 15745 / 4718. A move
below this level may reinforce strong negative momentum, which
can drag indices lower to test 15650 - 15330 / 4675 - 4540
levels. On the other hand, the Daily chart depicts a "Bullish
Hammer" Japanese Candlestick pattern. The said pattern will
be confirmed only if indices manage to break and close above
Friday's high of 16397 / 4925. In this scenario, markets may
bounce up to 16669 - 16900 / 5013 - 5085 levels.
Therefore, we reiterate our view that traders should stay light
on positions and follow strict stop losses.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Bears back with honed weapons - 4700 may be tested
Sensex (16372) / Nifty (4906)
As stated in our previous report, the negative crossover in
Daily "RSI - Smoothened" and "ADX (9)" indicator reinforced
massive selling pressure on the violation last week's low of
17096 / 5142. Thus, we witnessed a sharp correction in the
last four consecutive sessions. Financial uncertainty across global
indices clearly hurt sentiments in our markets. Despite the
positive weekly opening on Monday's session, indices slipped
below the psychological level of 16700 / 5000. On the sectoral
front, the Realty, Capital Goods, Power and Oil and Gas sectors
contributed heavily into this week's fall. The Sensex ended with
a loss of 4.78% and the Nifty lost 5.09%, vis-à-vis the previous
week.
Pattern Formation
Momentum oscillators viz. the RSI and the Stochastic on
the Weekly chart are negatively poised.
We are witnessing a negative crossover of "3 & 8 Weekly
EMA".
The stochastic oscillator on the Daily chart has given a
positive crossover.
The Daily chart exhibits a "Bullish Hammer" pattern at
78.60% Fibonacci Retracement level. This pattern needs a
confirmation.
Future Outlook
Markets registered a Weekly low of 16165 / 4845 and managed
to give a minor bounce on Friday's session, which pushed indices
higher to close marginally above 16300 / 4900 levels. We are
now observing that the momentum oscillators and "3 & 8 EMA"
on the weekly chart are negatively poised. Thus, if indices sustain
below the 16165 / 4845 level, further weakness is expected in
the coming weeks. This may result into a sharp decline to test
crucial and important support level of 15745 / 4718. A move
below this level may reinforce strong negative momentum, which
can drag indices lower to test 15650 - 15330 / 4675 - 4540
levels. On the other hand, the Daily chart depicts a "Bullish
Hammer" Japanese Candlestick pattern. The said pattern will
be confirmed only if indices manage to break and close above
Friday's high of 16397 / 4925. In this scenario, markets may
bounce up to 16669 - 16900 / 5013 - 5085 levels.
Therefore, we reiterate our view that traders should stay light
on positions and follow strict stop losses.
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