July 23, 2010

  • Nifty has closed well above 5 day high ema showing strength.
  • The bottom trend line of the raising wedge has given support so a rally till the top of the wedge is possible. provided nifty stays above 5 day high ema.
  • The weekly chart is also looking strong. The weekly stochastic has entered overbought zone but it is in no mood to turn down. Until it turns down and gives a sell it's a buy.
  • U.S. Markets rallied yesterday more than 2% which will help the bulls today morning.
  • Dow Jones closed up 201.77 points 1.99%
  • Three possibilities of Dow Jones.
  • First one is  a W formation in line chart of daily time frame. this will be confirmed with a move above 10380-10400 and a close above this range can push the index above 10600 levels.
  • The second possibility is the index getting resisted at the 200 DMA. My personal preference too is this one Dow forming an "M" after hitting the 200 DMA and going below 1000.   
  • The other possibility is a neutral range play for some time because of the lack of clear trend, Dow can remain in a range of 10000-10400 for some time.


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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