June 9, 2010

  • Confirm this bull flag only on an upside break out and trading above 10050 firmly.
  • Otherwise false break outs are possible
  • Longs should be taken with caution stop loss 9980.

  • BP monthly head and shoulders pattern break down and the target is a negative number. And that's not going to happen.
  • So unless they make some sweeping changes to the company's fundamental setup the stock will break well below 10.

  • Citigroups weekly consolidation in a triangle.
  • I am expecting an upside break out from this pattern But that is going to take some more weeks to happen.
  • Right now in the short term the stock can move to 4.75 in the coming weeks.

  • SP 500 has to face big resistance if it has to move above 1095.
  • Between 1085 and 1095 the down trending line will act as the first resistance.
  • If it breaks above that then there is the 38.2% retracement fib level of the fall from 1175.
  • So crossing this band is not going to be easy. Already it is struggling to cross the 23.6% retracement level.

  • Microsoft has reacted from the 38.2 fib level in hourly chart.
  • This level is acting as resistance. A break of this level can lead the stock to the 61.8% level at least.
  • If not able to cross 38.2% fib level will go back below 25.

DOW JONES BEARISH VIEW
VERY BEARISH VIEW
SLIGHTLY BULLISH VIEW
  • As you can see from the above charts the long term for dow looks grim and bears should love to see the second chart.
  • The first chart shows the bearish crossover of 20 SMA below 200 SMA. When the last time 20 SMA crossed above 200 SMA Dow was at 8400 levels and from there we went till 11000 levels. So this crossover is a very effective one.
  • Then the second chart Its a big rising wedge in line chart. If this one is to show its true colors dow should fall more than 3000 thousand points. I am being conservative there actually it should fall more. Remember all this on a long term prospective.
  • In the short term the only savior in the daily chart is the descending wedge. If this one works well bulls can show us 10400 back on screen. 

  • If trades above 5010 can go till 5035 and 5050

  • There are lots of similarities between indian markets and us markets.
  • above is charts of sp 500 at the top and below is the chart of nifty look how both of them move in similar patterns.

  • If this pattern gives a break out from resistance 1.
  • Then the target is around 5060-5070 


  • Nifty broke down from a rising wedge.
  • Now it seems we are forming a falling wedge pattern.
  • On the break of the upside line one can take a long trade.
  • To avoid whipsaw one can wait for a close above the trend line.


  • Nifty ended negative yesterday. But Some possible reversal patterns are still intact.
  • Like the inverted head and shoulders pattern is very much possible as long as nifty stays above 4900.
  • But on the contrary it is trading below the 20 day and 200 day moving average. And after many weeks the 20 day SMA is approaching the 200 day SMA for a bearish cross. If the cross does not happen this can give a good rally from here.
  • We had a break down from a rising wedge in hourly chart. So nifty has to close above 5140 for bullishness to return

30 MINUTES CHART
DAILY CHART
WEEKLY CHART
  • Dow jones Half hour chart is trying to reverse the down trend with a triangle break out.
  • But the trend in the daily chart is still clearly down as you can see the price is still moving down in the top portion of the channel.
  • The weekly chart is for me the most interesting one. 2 weeks from now dow will clearly decide which way it want's to go. So we can see large swings in the daily time frame that can give some good trades.

Disclaimer

All the contents of niftychartsandpatterns are for educational purposes only and are not Investment Advice or recommendations offered to any person(s) with respect to the purchase or sale of the stocks / futures. Niftychartsandpatterns shall not be held responsible for the actions of individuals, parties, or corporations taken in response to the ideas, thoughts, concepts or information presented in this blog. Hence all the visitors are requested to apply their prudence and consult their financial or investment adviser before acting on any of the Ideas in this blog.

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My Favourite Quote

"All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical formations and patterns recur on a constant basis."
—Jesse Livermore