Sunday, September 28, 2008
Nifty Future Weekly Analysis Based on Weekly Chart
Here I present my analysis of Nifty Futures based on Weekly Chart. However, As I said in my last posts, there is an atmosphere of indecision all throughout the world's capital markets caused by direct interference into economy by US and other govts. My view is charts incorporate traders' general psychology but incidents of such direct interference may result in charts not showing the actual picture.
Looking at the Weekly Chart of Nifty Future, last week was a big move down after previous week's volatile movement. I've drawn Fibonacci retracement levels for previous down move which shows Nifty Future did not manage to cross the 61.8% retracement signalling the down trend is intact. Another thing to note is last week was a hammer and the low of that hammer should act as support. The Main Downtrend Line is still holding and its resistance for the week starting tomorrow is at 4420. The Moving Average sequence is still bearish as 34 Period EMA is Below 55 Period EMA.
For short term the trend is still up, if we consider the up side move from 3800 to 4300, Fibonacci retracement of 61.8% comes near 4000 and Nifty future managed to close just above it.
For US Markets in general and S&P 500 in particular, I am too scared to post any chart or any view. When I see clear signs of govt keeping its hands off, then only shall I dare to put my analysis.
Once again I want to reassert my doubts regarding the irrational behaviour which markets may show thanks to the interference by govts. My advice is to preserve capital first. One silly action by govt can damage your capital to the point of no return.