June 22, 2010


  • If SP 500 closes below 1104 it's going to be a negative one for the bulls
  • Because that means three things. first one is that it is closing below 50 hour SMA as you can see from the first chart.
  • Second it is closing below an important support area.
  • Third one and the most important is that the breakout that happened is false one. 
  • Euro went below the ichimoku cloud at 1.47
  • Since then the pair has been facing stiff resistance from the cloud.
  • Now The pair is trading near the cloud.
  • Even before attempting to go near the ichimoku cloud the pair is getting sold off.
  • Yesterday dow faced big resistance in the form of 50 DMA.
  • Dow corrected more than 100 points yesterday after touching 50 DMA.
  • So this average will act as resistance for some time. If dow closes above it than 10730 will surely come.
  • But it seems its going to be a big fight near the 50 DMA.
  • On a closing basis 10390-10400 should give support but  the resistance above is too strong and Bulls need this range to be held for crossing the 50 DMA.


  • Apple Share has been outperforming the indexes with the help of its iphone and ipad sales. Also performing far better than its rivals like Microsoft.
  • Fundamentals of the company seems to be very strong. Technically too the share is trading above its 200 day and above its 50 day moving average.
  • Yesterday the the daily chart has produced a bearish engulfing pattern. And when it comes at the top of the trend it is a very good signal of an impending correction.
  • And the second chart shows a channel. The share trading near the top of the channel. One can expect the stock to dip till the 50 DMA if the channel is not broken on the upside.

Wall street is pointing to a lower opening on tuesday, S&P 500, Dow Jones, and Nasdaq Futures were all trading in red. The chinese currency stand gave good profits on monday and now the traders around the world seems to be booking some profits.

US futures were trading in red mainly due to the housing data that is to be released today. The National Association of Realtors and the Federal Housing Finance Agency will release home sales and home price index data for the month of may and april at 1400 GMT. And traders are also eying a Federal Open Market Commitee about to have a two day meeting on Tuesday.

European indices are also trading in red. Crude oil went down by more than 1% the oil traders realised that the gradual appreciation of the chinese currency will not have a big impact in the short term atleast.


MARKETS

CURRENT

CHANGE IN PERCENTAGE

UK 100

5299

-1.65%

France 40

3688

-1.29%

Germany 30

6240

-0.83%

JapanNI225

10112.89

-1.22%

Hang Sen 40

20819.08

-0.45%




UPDATED CHART
  • Eur/usd broke the channel yesterday.
  • Now that one candle has closed outside channel the break is confirmed.
  • Unless it trades above 1.23 it will be negative for the short term.
  • Right now it is trading at 1.22 region.
  • Above is a monthly chart of usdollar.
  • So any more rally in this index is possible only if it breaks and closes above 89 or 90.
  • Till then the multi month resistance line will stop it from moving ahead.
UPDATED CHART


  • Nifty futures trading close to an important support line.
  • One should watch how the index is reacting from this support area.
  • If it gives support a good run towards the high of the day can be expected.
  • Nifty futures 30 minutes chart
  • The last buy signal given by the ichimoku cloud has given great profits.
  • Now the cloud will act as support in dips.
  • The weakness may emerge if the price closes below the cloud
  • Nifty futures chart with yesterday's gap created at the opening.
  • Now any move into the gap should be negative and the index may try to fill the gap
  • As nifty is still in up trend and price staying above 5300 the index may take a u turn any movement.
  • Look for supports close to 5300 in nifty spot for buying. When i mean support nifty should hold 5280 and 5300 for an hour at least




  • Dow jones also had a negative day.
  • Dow jones was stopped by the 50 day moving average
  • After gaping up above the 50% retracement level. Dow jones did not close above 50% level.


  • A negative day denoted by the Bearish engulfing on chart.
  • The 50% retracement too acted as resistance for this index.
  • It is just about holding on to the 200 day moving average.
  • The 20 day moving average is below the 200 day moving average which is a negative setup.
  • The hourly channel shown above has broken and closed below the trend line.
  • Dow has formed a broadening formation in 10 minutes chart
  • Lets see if this pattern gives support for dow.

UPDATED CHART


  • SUPPORT LINE BROKEN
  • 10430-10460 IS THE NEXT SUPPORT ZONE
__________________________________________________________
UPDATED CHART


  • SUPPORT LINE BROKEN
  • 10430-10460 IS THE NEXT SUPPORT ZONE
__________________________________________________________

  • This is a 10 minutes chart of dow jones. 
  • I have plotted 50 EMA in the 10 minutes chart.
  • Now before the closing bell this 50 EMA may act as a support for a rally towards the high of the day.
  • There is a support line and a resistance line drawn in the chart.
  • Right now 50 ema is giving support. If the ema gives support along with support line below the ema we may see a rally before closing bell today.
  • On the contrary if the support line gets broken we may end lower.

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