Sunday, September 14, 2008

Weekly Analysis of Nifty and SnP 500 Futures

The NSE Nifty Future (see weekly chart) fell last week and the US index - S&P 500 Future went all over the place to finally close marginally up. Today I am presenting my views based on Weekly Charts of both these indexes.

Nifty Future Weekly:

Nifty Future Weekly Chart 12 Sept 2008
Last week I warned my readers about resistance in the 4500+ area and again on Wednesday, Sept 10, I warned there can be a fierce down move on Nifty Future and the last two days of the week showed just that. Looking at the Weekly Chart of Nifty Future I have following view:

1. Nifty Future is in confirmed downtrend that started in January this year. The Main Downtrend Line is holding firm and last week it acted as major resistance.

2. Nifty Future is well below the 61.8% retracement, about 4700, of the down move from May high to July low. For any trend reversal, it has to break this on upside.

3. The Moving Average sequence is still down as 34 Period EMA is below 55 Period EMA which is below 200 Period SMA. In my charts 34 EMA is always the red curved line and 55 EMA is blue curved line. Also, If you notice it, the 34 EMA in itself is a big resistance on Nifty Future Weekly Chart.

S&P 500 Future:
SnP 500 Future Weekly Chart 12 Sept 2008
As I told last week, there was an almost retouch of 1200, the July low on S&P 500 Future. Looking at the Weekly Chart of S&P 500 Future we can see last week there was a lot of movement in the price but the closing although up, was more a confirmation of primary bear trend. Based on the Weekly Chart, following are my views:

1. The weekly close (1254) is just around the double bottom lows of January and March this year, indicating a resistance point.

2. Moving Average Sequence is still bearish as 34 Period EMA is below 55 Period EMA which is well below 200 Period SMA.

3. S&P 500 Future failed to retrace back to Fibonacci 50% retracement of the down move from May high to July low.

Conclusion: Both Nifty Future and S&P 500 Future are in clear Bear Trend. There are fierce rallies at times but those are more entry points for fresh shorts than any trend reversing signals.


  1. Hi Harry,

    Very nice analysis and clear reasoning. Appreciate your posts.


  2. Thanks arvind,

    Pls keep visiting and leaving your valuable comments and suggestions.


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