SENSEX : I HAVE been trying convey our technical view quite categorically that the rally in sensex from end march to april-2011 is BEAR MARKET rally only and we clearly advised every one to remain in cash from the first instance of Infosys got tanked on the result day we said that market is going to punish stocks after their results and on last Friday we said in our sms that the RBI will increase interest rate MORE than normal anticipation and the same happened.
In a single trading day SENSEX broke the first support line and also closed decisively below 200 day EMA THIS IS A TYPICAL CHARACTER OF BEAR MARKET WHERE SUPPORTS JUST DOES NOT WORK.
We are of a VERY STRONG opinion that most of the companies will have POOR performance for next two quarters and that is EXACTLY WHY THE MARKET IS REACTING NEGATIVELY NOW.
Two earlier gaps at 18374 and 18218 may act as some supports but since we now have confirmation of ANOTHER lower top after this gaps get filled we will have SENSEX targets of 17786 and 15992.
Nifty :
NO support did work in yesterdays big crash we had been said that it will be EXTREMELY BEARISH if nifty closes below 5759-5693 and that is what exactly has happened.
Up side gaps at 5531 and 5484 will act as some support but now we have a strong confirmation of a “lower top “ in place so once nifty closes these gaps it will have positional down side targets of 5356—5177-4855 –4777.
All are advised trade and invest accordingly.
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