WEEKLY CHART BOOK

WEEKLY TECH VIEW OF SENSEX & NIFTY:

There is no major change in the SHORT TERM trend which is still up as on EOD CHARTS

No major change or not even any hint of change of trend as on WEEKLY CHARTS which is SIDE WAYS

I would like to post SENSEX charts with ADX on all time frames again and it shows that the LOW MOMENTUM in our markets is clearly defined by the EXTREME LOW VALUES of ADX on all time frame charts in the history of SENSEX.

IN early days ADX used to have low values BUT it would soon pick up the momentum but SINCE the slump of 2008 there has been a gradual decrease in ADX VALUES on HIGHER TIME FRAME CHARTS and since then ADX has not been able to pick up again.

SENSEX MONTHLY CHART WITH ADX :

As can be seen on both above charts first time AFTER 1996-1999 ADX has turned down sharply after 2008 crash and especially after 2010 till date

This proves that our market is not at all favourable for POSITIONAL TRADERS at this juncture.

MY EARLIER TECHNICAL VIEW ABOUT DIFFERENT SECTORS AND A FEW LONG TERM INVESTMENT PICKS:

LINK: http://bhoom2tika.blogspot.in/2012/01/2008-2011-shift-of-focus-long-term.html

I had suggested  “ SELL NIFTY AND BUY ITC/HUL “ in January 2011 and then on 2^nd January 2012 in my detailed SECTIRIAL ANALYSIS in a report named as “2008-2011 CRASH A SHIFT OF FOCUS” i had these comments on FMCG SECTOR with following chart

“Looking at broader market condition and possible PROLONGED accumulation phase in addition to a huge BULL RUN since last three year, this sector may enter a CORRECTIVE PHASE which will be giving us very good buying opportunities in panic during 2012”

And here is what has happened till date in 2012

How HUL has SIGNIFICANTLY out performed the BROADER MARKET in 2012 can be seen clearly in this chart

Read this comments about another important sector which is in STRONG BULL PHASE right now:

“Here comes an important question WHICH SECTOR will lead such a massive BULL RUN ?

We track SENSEX & NIFTY only for short/medium term view on the markets in general but a detailed study of all SECTOR INDEX charts reveal that INDIAN MARKET has been going through a great SHIFT OF FOCUS from the bigger & long term players’ point of view.

This long term money is least concerned with anything in the World Market but is focused on the intact long term India growth story.

This detailed study clearly reveals that TECHNICALS can understand such a long term shift of focus as well.

In the charts attached here, one can see that FOUR SECTORS completely underperformed the SENSEX & NIFTY for a significantly long period of time in the massive BULL RUN of 2006-2008. These were AUTO, IT, FMCG and HEALTH.

But all these sectors out performed broader markets in 2009-2010 BULL RUN and in fact out of these four sectors BSE AUTO topped out in 2006, BSE IT topped out in 2007 and BSE HEALTH & FMCG completed a DOUBLE TOP in 2008 so after topping out very early before 2008 these FOUR sectors COMPLETED a larger correction in 2008 and started NEW MEGA BULL RUN which promises to go far away from here.

Simple reason for such EXPECTATION is that all these FOUR sectors are now out performing broader markets by huge margin through this 2011 crash.

We suggest one goes through our comments on all these charts of different sectors.”

BSE HEALTH CARE MONTHLY CHART 2001-2011:

BSE HEALTH CARE INDEX also started a BULL RUN in 2003 but was a clear defensive SECTOR only till 2007 this sector too went in to deep red during 2008 but it did not remain a steady performer any more from 2009 and reached life time highs in 2010.

So it has also out performed SENSEX in recent crash and now it is showing signs of having entered a CORRECTIVE PHASE which should be an ACCUMULATION instead of distribution phase.

BUY ON DIPS would be a good suggestion for Pharma sector stocks in 2012 for a GREAT BULL RUN ahead.

CIPLA, DIVISLAB, SUN PHARMA, DR REDDY, RANBAXY ARE THE TOP PICKS IN HEALTH-CARE SECTOR.

Please read above comments made 7 months back and see what has happened to this SECTOR STOCKS in 2012

As very clearly described in my early JANUARY 2012 article “SHIFT OF FOCUS” we have witnessed that PROCESS OF SHIFT continue through 2012 and the SECTORS identified as underperformer hade continued to underperform till date.

BACK TO the FUTURE:

There is no TECHNICAL change as far as SHORT & MEDIUM term charts of SENSEX and NIFTY are concerned.

Very range bound and stock specific moves taking place

SHORT TERM bullish but now caution is advised again as SENSEX has failed to cross 17742 and NIFTY has failed to close above 5378 again.

5378-5442 is the zone of resistance and 5246-5260 GAP is an important support for the next week as well.