WEEKLY TECHNICAL VIEW FOR THE WEEK STARTING FROM 11TH JULY 2011 :
Not a very good end of the week.
It was a very good up move on thursday but a "dark cloud cover" candle pattern on friday may have put SENSEX again in range bound trades.
Deep correction or a down trend on a close below 18622 possible
We suggested about a pause / healthy correction from the last week itself which came and lasted for four working days then on Thursday in our DAILY TECHNICAL VIEW we suggested an up move above certain levels especially for NIFTY traders we suggested a buy above 5639 and advised to add above 5659
And we gave targets of 5716 and 5780 and NIFTY FUTURES made a high of 5760 on Friday but then there was a crash.
On DAILY charts of SENSEX AND NIFTY there are CANDLE REVERSAL patterns called DATC CLOUD COVER which suggest short term TOPPING formation
BUT unless and SENSEX and NIFTY breaches below their 200 DAY EMA for 2-3 consecutive close and unless we get a 5/8/13 short term EMA BAND SELL CROSS we presume the market to have entered in a RANGE BOUND trade.
This candle stick pattern is considered to have failed if price closes above LAST DAYS high in FOLLOWING ONE OR TWO days.
For NIFTY the high was 5760 and for SENSEX it was 19131.
WEEKLY CHARTS OF SENSEX AND NIFTY :
On the weekly charts both SENSEX and NIFTY developed a DOJI STAR pattern which suggests INDECISIVE NESS at higher levels so in any case BULLISH NESS above Friday highs and BEARISH NESS below 5605 and 18662. For NIFTY and SENSEX respectively.
After a big up move on 24th june we said in our weekly chart book that one day big up move can not change our bearish view overnight but then we can not even ignore a probable 300 + points up move in NIFTY and we also clearly suggested after the PANIC BOTTOM at 5182 (our target was 5177) that such panic bottom can not be BROKEN very easily.
So we used a big rally in a way that our SEVEN STOCK PICKS of the WEEKLT CHART BOOK of 27th june generated returns of 7-10 % in two weeks time.
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