June 29, 2011

  • Dow jones four hour chart with the down trend line.
  • Price is testing this trend line. If bulls are to extend gains they have to break this trend line convincingly. 
  • Price consolidation here may result in a fall.
  • SPY 4 Hour chart with the cloud
  • Trend will turn in favor of bulls completely only if they manage to break the cloud and stay above it.
  • Till that happen bears has the option of selling this rally.
  • Price has violated the resistance level of 129.80 level.
  • Now for bulls price should stay and close the day above 129.80 .
  • Price falling below this level will favor bears
  • CISCO has given a Grave Stone Doji pattern.
  • It's a Bullish reversal pattern. But needs price confirmation. In this case price movement is looking good for the bulls. Weekly close above the last weeks high will be good for bulls.
  • Second chart too shows a bullish pattern. Break of the resistance line can give a rally.
  • Price breaking below the grave stone Doji will favor bears
  • Nifty Knocks 5604 one more time.
  • We have to see the price action here. Only a daily close above this level will confirm strength.
  • ABOVE BROADENING PATTERN WAS SUGGESTED IN THIS POST
  • Nifty moving up towards the resistance level of 5604 with an unfilled GAP.
  • So if price struggles near 5604 level we may see a pull back towards the GAP.
  • NIFTY WEEKLY CHART
  • Price approaching its weekly resistance level.
  • Recent attempts to stay above 20 week moving average has failed.
  • So a bigger breakout cannot be seen unless price closes above 20 week moving average.
  • Second chart shows stochastic turning in favor of bulls. Now if the corrections are not large price may continue to move up. 
  • Lets wait and see how price reacts near 20 week moving average. 
  • SPY Hour chart with the selling zone.
  • 129.60 - 129.80 level is acting as resistance in hour chart.
  • Daily close above this level may push price above this zone. Unable to cross this level will result in selling.

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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