WEEKLY TECHNI VIEW

A BIG QUESTION MARK ON THE FUTURE MOVE OF SENSEX and NIFTY :

is this massive  1783 points rally from the recent low of 17792 the last weeks high of 19575 in just 9 working days ONLY a correction ? or weather it is the FIRST leg of new and even bigger BULL rally ?

this is an extremely difficult question to answer but let us first identify the current trend on different time frames.

On short term that is daily charts  the trend is clearly up BUT it will a tough ask for bulls to maintain this SHORT TERM upwards bias , reasons ?

1 a  big trend line coming up as resistance

2 many such rallies turns out to be BEAR MARKET rally if the rally fizzles out near 80% retracement levels.

3. the CRUDE CHART which is in GREAT upward momentum

From medium term point of view as we study weekly charts  market may just have entered in a side ways phase in which we will not see any new high or new lows for sensex and nifty but we will see STOCK SPECIFIC movement

TWO MOST IMPORTANT TREND DECIDER LEVELS ARE ESTABLISHED FOR NEXT FEW WEEKS FOR THE UPSIDE THIS LEVEL IS 20315 AND FOR THE DOWNSIDE THIS LEVEL IS 18764.

From the LONG TERM perspective as we are consistently saying that any correction during 2011-2012 will be A LIFE TIME BUYING opportunity as sensex –nifty may pass on a few years in higher range before  BIG  breakout.

For this upward momentum to continue a HEALTHY correction will be very good and a new high around 20200 again after a brief correction will be a very good event to watch.

STATE BANK AND LARSEN AND TOUBRO :

We believe  that sbi and Larsen will decide or atleast will play very crucial role in deciding the future of our markets for a few weeks.

This is because in the current rally for sensex and nifty both these giants have not participated much and in fact have started to weaken in last 2 days so if there is any chance of the last rally being FIRST LEG of a new and larger upside sbi and Larsen MUST break their immediate resistance levels shown on their charts ELSE the rally may just prove to be a begger correction of the 4 month long down move.