Nifty(5269): Nifty formed a 'Doji' pattern after overshooting the important resistance at 5275. We have momentum disagreeing with price rise above 5217 on hourly and daily time frame. This is normally a precursor to a drop.
Nifty - Weekly charts
On the weekly time frame, Nifty is above the weekly trendline from the Nov 2011 highs. A close above this level today would tell us that we are not in the same environment that we were in since Nov 2011. Alternately, a strong rejection from here would mean some bearishness.
Likewise for many important inter-related markets like the Dollar Index, Gold and S&P 500 the markets are poised at a critical time and price window.
Gold - 1765 is a 61.8% Fibonacci retracement level. As I write this, it is coming off slightly from the overnight high of 1761. Euro - the zone of 1.32 to 1.35 is important and the 17 nation currency has got rejected twice off this level. The US S&P - VIX is at a dangerously low level, momentum indicators are warning off lack of fire power.
Time: Feb 6th/8th happens to be an important time window for a short term peak ATLEAST for equities.
The bottom line is the risks of being long here is very high - if you are long be nimble.
Nifty support and Resistances: A drop below SUPPORT of 5225 would mean the first signs of corrective decline to the move from 4530 to 5291. We have to evaluate if it might mean something bigger. A bare minimum correction of 4950 should come through.
In the event Nifty continues to head higher, RESISTANCE is at 5345.
10 Responses to “Technicals Feb 3rd 2012”
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SIR THE NIFTY 4800 PUTS SHOULD BE HOLD OR COVERED(6 LOTS) PLEASE UR ADVICE
Gunjan,
The way I see it – a bare minimum drop to 4950 EVEN IF THIS is a bullish set up.
yes sure 4950 towards end of this month
Jai,
I have been following your comments for the last 9 months atleast. One thing I had noticed was that you always have two scenarios for the SHORT TERM.
However, in the last one months, I have seen you to be pretty one sided ( negative ) about your views on the market. This increase must be baffling to you ?
Regards
It has been frustrating Rut. But not as bad as it could have been had we had been short at 4940 or 5065. It is better to feel bad being outside the market than feel being in the market and not able to get out 🙂
Jai, your view on USD- Re now that it has breached 48.85. Thanks
Jai,
How do you read the US data and its implications on India market next week?
Thanks
Shiva
hi jai,
any change in bearish view, after the recent run up in nifty above 5345 levels,
regards
We have to wait – multiple interpretation possible now. Let me see what looks most probable.
jai one more thing baltic dry index is still going lower current check 647.
regards