WEEKLY TECHNICAL REVIEW 211111

WEEKLY TECH VIEW FOR SENSEX AND NIFTY FOR THE WEEK STARTING  FROM 21^ST NOV. 2011 :

SENSEX and NIFTY both got some support at one BULLISH GAP on EOD charts AND as suggested in our daily TECH VIEW on 18^th November.

But through the week both indices fell sharply as SENSEX closed below 17200 and as NIFTY closed below 5156.

Also note that we had given clear advise to sell on rise once NIFTY failed to close above 5205 on 14^th November.

We said on Friday that NIFTY will have a corrective rise from the BULL GAP between 4827-4872 levels and NIFTY made a low of 4837 and close at 4905 and we had given a down side target of 4833 which was achieved on Friday too.

In our weekly chart book dated 081111 we said this,

“For NIFTY a close below 5156 and for SENSEX a close below 17100 will put all the bullish hopes to an end.

The stochastics on weekly chart for both indices is now reaching overbought zone so it will be better if both reaches their targets during this week else it will enter another corrective down side from the next week or so.

Such small range bound markets are difficult to predict and we shall wait for the breach of small ranges.

And by all means the last upside still does not look to be a new BULL RUN.”

The last sentence said it all and once again after catching a massive upside up to 5400 we did not miss the severe down side as well.

NOW WHAT ?

16641-16744 is the price zone which will prove strong resistance if SENSEX moves up in the next week.

we can not ignore the bullish gap support at 16148-16044 zone but,the follow up bounce must be strong enough  to close above 16744 for a meaningfull rally.

For the medium term perspective 17200-17300 zone becomes THE MOST IMPORTANT TREND DECIDER LEVELS NOW THEN EVER BEFORE.

For NIFTY there is a support at 4837 level as it is a BULLISH GAP area and as NIFTY has produced a LONG LEGGED DOJI candle reversal pattern we may see a few days up move .

4989-5033 price zone is an important resistance zone for NIFTY and only a close above it can have something for bulls and every such rise up to 5156-5177 will be considered as CORRECTIVE only.

As we have been suggesting since 8^th November 2011 that STRENGTH OR WEAKNESS in cnx BANK NIFTY will play a very crucial role and as on Friday it seems that BANK NIFTY has weakened further so this particular index is going to to be A MAJOR DRAG for our markets for next few months.

The supposed inverted HEAD & SHOULDER pattern is about to fail and so it will have further damaging impact on BANK STOCKS.

It is prudent to have a look at what we projected about SENSEX and NIFTY FOR THE YEAR 2011 IN PRESENT SITUATION because one/two years BULL AND BEAR cycles are part of long term SIGNIFICANTLY BULLISH PICTURE.

There is a strong possibility of NIFTY AND SENSEX getting some supports around 4720 and 15700 levels respectively and if we don’t see a major recovery from there NIFTY will find strong support around 4538 BUT there will be a FREE FALL below 4500.

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TECH VIEW TODAY

SENSEX: today we gave SENSEX support level of 17273 and it made a low of 17276 and bounced back sharply from lows to close in GREEN.

Remember we have been suggesting that the zone of BULLISH GAP and previous resistance levels of 17100-17215 is very crucial support and a bounce from there will be positive.

17278 is the level to watch on closing basis for next few days as a STOPLOSS level for short term longs

NIFTY : for NIFTY also our support level was 5205 and NIFTY made a low of 5201 also since last 3 days we have been clearly saying that the GAP level of 5219 and 5156-5177 zone is crucial support and today future NIFTY made a low of 5219 and closed above 5300 which is very positive.

NIFTY looks to have ended the small correction and next targets seems to be 5420-5475 zone.

Stoploss for short term longs should now be placed at 5201 on closing basis.

Also there is a BEARISH GAP at 5314 NIFTY level so some profit booking is expected around that level.

A close above it will take NIFTY up to 5420-5475 levels.

CHARTS WITH COMMENTS

WEEKLY TECHNICAL VIEW : A FEW CHARTS

UP SIDE TARGETS REACHED

CHART SPEAKS :

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WEEKLY TECHNICAL VIEW

WEEKLY TECHNICAL VIEW OF SENSEX AND NIFTY FOR THE WEEK STARTING FROM 25-10-2011:

Shortened week due to DIWALI holidays and INDECISIVE technical picture in addition to bigger events like EU MEET on greek crisis and RBI meet on Tuesday makes it very difficult to predict the future of our markets for the next week.

Level wise for NIFTY 5011 has become an important trend decider level same level for the SENSEX is 16669.

For more hopeful long side traders 4964 and 16510 are two crucial STOP & REVERSE levels for NIFTY and SENSEX.

IF the on going side ways move between 5160-4964 proves to be a corrective only and NIFTY breaks the barriers at 5177-5196 it will reach 5225 and 5330 for SENSEX an important target is 17800 if it breaks 17200.

First indication of such an upward break will come if on Monday crosses 5106 and stays above it for 10-15 minutes.

The more difficult time for bulls will come whenever NIFTY and SENSEX closes below 4964 and 16510 because after that they will have down side targets of 5625-5538 and 15300-14900 respectively.

There are some good technical evidences like positive divergence in MACD and EMA crossovers but since ADX is still not picking up momentum markets are not moving big in either direction.

If we talk about  a little longer picture a very few stocks are showing some signs of bottoming out still a very large number of stocks which were very active in the last bull run are not showing any symptoms of significant bottoms.

So even if indices are managed to break certain key resistance levels it should not be considered as KEY REVERSAL IN CURRENT TREND.

Although with our sharp and innovative technical tools if find some strength somewhere we will let our readers ride good up moves.

the most crucial resistance zone  17211-1731 and despite a good bull candle in the second last week SENSEX just can not cross these hurdles. bullish supportive buying got generated from around 16515 and from 16669

BUT

if such bullish attempts can not convert in to a crossover of these hurdles eventually bears will again take control.