Monday, February 20, 2012

CNX Nifty 'End of Week' Technical Analysis: After week 13-17 Feb, 2012

Recap: Last week one saw the Fall of the Fibonacci 76.4% marked on the EOD charts (post here). We noted that our channel drawn a month ago - was exactly followed by the Price (post here) and in the same post, we also observed that some crossovers indicate the Bull Market's return, then we studied moving average crossovers - both for and against.

Nifty - End of Month Chart - 17 Feb  2012 - each candle is ONE MONTH
Nifty - End of Month Chart (EOM): Around mid December we had observed (post here) that a pullback to the Green line was possible (highlighted with a blue oval above) - at that Bearish time it looked a remote possibility - today that line looks tantalizingly close. This month's candle can touch the green line at approx 5747 and next month's candle approx 5838. Now, we shall zoom in for a closer look at the area marked in the blue rectangle - with the EOW chart below.

Nifty - End of Week Chart - 17 Feb  2012 - each candle is ONE WEEK
Nifty - End of Week Chart (EOW): Last week's candle has exactly touched our channel top (highlighted with a blue  oval above). Cracking last week's high should give us our new channel (shown in black) and the targets discussed in the EOM above. A consolidation around the channel top is healthy for the up move. We now study the area marked inside the blue rectangle with the EOD charts below.

Nifty - End of Day Chart - 17 Feb 2012 - DAILY close price in a line
Nifty - End of Day Chart (EOD): We are near channel top here also as observed earlier (post here).  The next leg of the up move or consolidation should be watched in sync with EOW and EOM notes above. Bulls remain strong above 5454. Throw back should be held by the Fib 76x line.

Looking forward: Channel tops, both on EOD and EOW, smell of consolidation. Bulls however have enough momentum to take the climb into a steeper channel up. Fundamental reasons (Budget and PIGS) may queer the pitch. Battle lines between Bears and Bulls are drawn for now, at the channel lines as studied above.