Indian Markets at Last Support?

Friends,
Today I present something that is as obvious as oxygen in atmosphere and yet very rarely talked about. I am talking about the long term direction of S&P 500 of USA and NSE Nifty of India.

7th of October, 2008 was when S&P 500 broke the most important support of long term bull market. It was October (quite coincidentally), to be precise, 10th of October, 2002 when S&P 500 index hit a low of 768.63 and a new bull market started after that. On 11th October, 2007 (again a coincidence!), it touched a high of 1576 and as we know the bull market of past 5 years was over.
Taking Fibonacci retracement into consideration, the last support of 61.8% of this up move comes at 1077 and as I've already told, it broke that support decisively. It was last week but considering the interventions and interferences by various governments into capital markets and economy, I thought it might be a result of that. Officially, the bull market is over and if a new bull market starts it will be brand NEW one.

Nifty & Sensex Long Term Trend:
Now let us come to the Indian Markets. The benchmark BSE Sensex and popular NSE Nifty are both at a point which is most important support regarding Fibonacci for the bull market of past 5 years. The 61.8% retracement held this week and it will be interesting to see how these indices behave in coming days. Look at the graph below to see various Fibonacci levels on NSE Nifty:

So, what does it signify? Is the down turn over? Will the previous bull market that got broken in Jan this year resume?
I have simple view regarding this. In my opinion Fibonacci 61.8% is very important retracement level and if we see historically this number has almost always held. Rather than predicting the next move, I would suggest watching the action. If these supports hold, then the long term bull market is intact, otherwise, its over and we better forget that bull market. Had it not been the case for US Markets (that is the broken important support), I'd advise cautious buying here. However, given the importance of this 61.8% retracement level, it would be better to not be a bear for some time and be very cautiously optimistic unless this last support is decisively broken.