October 10, 2010

  • Daily line chart shows a steady up move. right now the index is at the top of the channel with chances of either a breakout or a reversal from the top of the channel which will be supported by the ascending channels support line. Line chart shows good support at 1158 - 1160 area.
  • Trading above 1160 index can target 78.6% level at 1175.
  • If a sell off happens the channel is positioned in such a way that it forms another higher low. Problems for the bulls happen if the higher low higher high structure gets broken. Till then slowly but surely this is going up. 
  • Main resistance for the index now is 12728 - 12738 area.
  • Important support for the index is at 12320 area.
  • There is a raising trend line which can also give support for the index.
  • Important levels inside the range of 12320 to 12728 are 12414, 12550, 12650

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"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