US MARKETS WERE DOWN ON LAST THRUSDAY AND FRIDAY AND CORRECTED 7 DAYS RALLY.OBAMA ADMINISTRATION PRESENTED PLAN LATE SUNDAY "TO BUY UPTO CLOSE TO $1 TRILLION IN BAD ASSESTS.AS PER TREASURY PLAN IT WILL INITIALLY COMMIT UPTO $100 BILLION TO SUBSIDIZE PRIVATE INVESTOR'S PURCHASE BANK'S SO CALLED TOXIC ASSESTS.ITS AIM IS TO BUY AT LEAST $500 BILLION OF BAD ASSESTS AND POSSIBLY UPTO $1 TRILLION OVER TIME." THIS NEWS SPARKED GLOBAL RALLY ON MONDAY AND ALMOST ALL THE MARKETS CLOSED FROM 1% TO 5% UP.
INDIAN MARKETS SHOWED STRONG RALLY YESTERDAY AND WITH THIS UP MOVE NIFTY HAS ENTERED ITS 2nd LAST RESISTANCE RANGE OF LAST 5 MONTHS RANGE BOUND MOVE.NEXT RESISTANCE RANGES ARE:-
1- 2900-2970(PRE INTERIM-BUDGET RANGE)
2- 3120-3152(LAST RESISTANCE OF 5 MONTHS RANGE)
1- INDIAN MARKETS ARE RANGE BOUND FOR THE LAST 5 MONTHS WITHIN THE RANGE OF 2524-3152.
2- LONG TERM IS DOWN. SHORT TERM AND INTERMEDIATE TERM TRENDS ARE UP.
3- SINCE JANUARY 2008 FALL NIFTY EITHER COULD NOT MOVE ABOVE 100 DMA OR DID NOT SUSTAINED ABOVE IT.
4- IT HAPPENED FIRST TIME SINCE JANUARY 2008 THAT NIFTY MOVED ABOVE 100 DMA WITH FORCE YESTERDAY.
5- FAST AND SLOW STOCHASTIC ARE IN OVER BOUGHT ZONE BUT THESE SHORT TERM INDIDICATORS MOVES VERY FAST FROM ONE OVER BOUGHT TO ANOTHER OVER BOUGHT IN TWO OR THREE DAYS FAST MOVES.
6- IN MACD MACD LANE CROSSED UP AVERAGE LINE IN NEGATIVE ZONE THUS SHOWING STRENGTH.
7- RSI AND ROC ARE MOVING UP IN POSITIVE ZONE THEREFORE THESE TWO ARE ALSO SHOWING INDICATING UPMOVE.
SENTIMENT IS EXTREMELY BULLISH AFTER YESTERDAY GLORIOUS GLOBAL RALLY THEREFORE INDIAN MARKETS WILL OPEN GAP UP TODAY BUT NEXT UP MOVE CONFIRMATION WILL COME WHEN NIFTY WILL SUSTAIN ABOVE 100 DMA AND 5 MONTHS RANGE HEIGHTEST(3152).
AS SENTIMENT IS HEATED TODAY THEREFORE THIS FACT MUST BE KEPT IN MIND THAT PROFIT BOOKING ALWAYS COMES IN HEATED SENTIMENTS THEREFORE MARKET MAY BE VOLATILE AND BUYING SHOULD BE DONE MINIMUM AFTER THE COMPLETION OF INTRADAY CORRECTION.AS YESTERDAY UP MOVE WAS VERY STRONG THEREFORE MARKET REQUIRES COMPLETE SELLING PATTERNS BEFORE THE BEGINING OF ANY DOWN TREND.
AS A THUMB RULE FOR CONFIRMATION OF TREND WATCH SUSTAINING OF NIFTY ABOVE 100% AND 3152. IF NIFTY SUSTAINS ABOVE THEN STRONG UPMOVES WILL BE SEEN AND DOES NOT SUSTAINS ABOVE THEN RANGE BOUND CHARACTER WILL REMAIN CONTINUED.
GREEN OPENING AND GREEN CLOSING IS EXPECTED TODAY.
US MARKETS ARE UP 18.80% IN LAST 10 TRADING DAYS THEREFORE GLOBAL MARKETS SHOWED SHARP UPMOVES.
(LALIT KUMAR DHINGRA)
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