Saturday, January 31, 2009

S&P 500 (US) Future and Nifty Future Analysis

Dear Friends,
Today I am posting my analysis of S&P 500 (US) Future and Nifty Future based on Daily and Hourly Charts.

S&P 500 Future Daily Chart

Looking at the daily chart of S&P 500 future following is my observation:

  • There is a clear and complete rising wedge which started in late November last year and completed (breakout downwards) in the first week of January this year. The implication of this breakout is that we can at least see the retest of November 2008 lows (if not break of that).
  • The trend is clear down as 13 (green curved line), 34 (red curved line) and 55 (blue curved line) EMAs are in downward sequence. The only thing that may be giving false hope to bulls is 200 SMA which is still near 1050.
Nifty Future Daily Chart

Looking at the daily chart of Nifty Future I arrived at the following conclusion:
  • Nifty Future is perfectly in tandem with what is S&P 500 Future. A rising wedge started from late October last year and completed in first week of January this year. What an amazing similarity! The implications of this pattern is a cool 1000 points down from near 2800! So my guess is if this pattern gives its target, we may very well see 1800 on Nifty future soon (intermediate term).
  • The moving average sequence is also clearly downward as 13 EMA is below 34 EMA which is below 55 EMA. Once again, like on S&P 500 Future chart, the 200 SMA is still far away which may give false hope to my bull friends in India.
Nifty Future for Short Term

For short term traders, I present my brief observation of Hourly Chart of Nifty Future:
  • There seems to be a Double Top forming (if it stops going up from here) which will complete only if Nifty Future breaks below 2760. But, before that we need to look at recent uptrend line support which is at about 2800.
  • The EMA sequence is positive for bulls as 13 EMA is above 34 EMA which is above 55 EMA. However, the 200 SMA on Hourly Chart is above these which means this upward bias can be weak. The EMAs are very near each other and a breakout on either side can be expected soon.


  1. The market does not look very good right now and on top of that the VIX looks like it is about to make a move. Not good when the market is heading down. Here is a useful chart I found that shows some important info about what is going on in the economy right now.

  2. Thanks Brandon,

    I visited the site and left my comments there...


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