LEVELS TO WATCH

SENSEX :

Sensex has closed both the GAPS which in normal circumstances could have given support and so it confirms our argument that the march-april rally was only a BEAR MARKET rally.

Today is the last day of the current week and as usual a weekly close is important and if sensex closes around 18100-18300 it will be a VERY WEAK weekly close which will clearly suggest that any rise in coming days up to 200 day EMA can be used to create fresh short positions.

SENSEX has also closed below 200 DAY EMA for three consecutive days which is EXTREMELY BEARISH.

But since the short term MOMENTUM indicators are in extreme oversold zone if SENSEX closes above 18339 we may see some corrective upside rally.

NIFTY :

NIFTY has also closed below its 200 DAY EMA for three consecutive days which is a negative sign and now we will see the SHORT TERM EMAS will resist any upside corrective rally in coming days.

We are going to see the worst weekly close of last few months if NIFTY closes around 5400-5500.

On the down side NIFTY has supports around 5337—5356 range and after a few days corrective upside or range bound move if nifty closes below 5336 it will be another opportunity to go short.

A close for nifty above 5503 can initiate some upside corrective.