June 6, 2011

  • SPY 15 Minutes chart with trend line and cloud resistance.
  • Bulls shall hope for a trend line break on the upside.
  • But the trend will remain down as long as price stays below the cloud.
  • ES - LIFE LINE FOR BULLS
  • Sloping trend line and the horizontal line in daily chart shown in the first chart may help bulls for a long trade Provided 1290 is not broken.
  • Price is also getting support at the Golden Ratio for the rise from 1241.50 to 1373. So this makes 1290 an important level.
  • Break of this level will favor bears.
  • FORD MOTOR CO TREND LINE BREAK
  • BEARISH ENGULFING OF IWM
  • A possible double bottom formation in unitech weekly chart.
  • Price also has a bearish descending triangle pattern. But positive divergence in weekly RSI is negating the bearish pattern So Chances of the bullish double bottom playing out is more.
  • So one can try a long trade with 30.3 as stop loss.
  • NIFTY INTRADAY UPDATE
  • Nifty has held on to its 20 day moving average for now. But if tested again today we may see it close below 20 DMA.
  • Price has turned in favor of bulls in 5 Minutes time frame. Price trading above cloud in 5 Minutes after a while. Resistance area for this up move is between 5525 - 5535 level. Hour closing above this level will favor bulls.
  • A perfect example of price volume breakdown.
  • Change of volume from 1.702 M to 61 M a Huge change with price fall.
  • For bears the problem is that the Head and shoulders Target seems to be achieved.
  • So we might see a bounce towards 315 - 320 levels. And then fall bigger.
  • But such a huge volume sell will put pressure on bulls in the coming months.
  • NIFTY WEEKEND UPDATE
  • NIFTY Month chart shows the current month candle near the apex of a possible triangle pattern. According to the rules of the pattern price breakout may give 4200 points.
  • Second chart shows MACD in buy mode, Next chart shows STOCHASTIC in a possible sell mode. short term looks weak but if the lows are not taken out MACD can still remain in buy mode like it did in the last Buy signal which is marked on 2nd chart.
  • Price closing below 20 day moving average will favor bears. 50 DMA will be the resistance for an up move.
  • NIFTY WEEKEND UPDATE

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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