Technical Research | September 12, 2011
Daily Technical Report
Sensex (16867) / Nifty (5059)
Markets opened on a flat note and traded with immense
Exhibit 1: Sensex Daily Chart
volatility during the first half but the selling pressure
intensified near day’s high which dragged indices lower to
close near “20 Days EMA”. On the sector front, Banking,
Metal and Oil & Gas counters were among the major
losers. The advance decline ratio was in favor of declining
Formation
• We are observing a “Horizontal Line” resistance at
17300 / 5177 level which was the crucial swing low made
in February 2011.
• Last Weekly candle resembles a “Spinning Top”
formation near above mentioned resistance of 17300 /
5177. This pattern needs a confirmation.
Source: Falcon
• The Daily chart depicts a “Rising Wedge” continuation
pattern.
The breakdown will be confirmed if indices sustain below
• However, On the Weekly chart, the positive crossover in
Friday’s low of 16830 / 5046. Subsequently, indices may
momentum oscillators viz., the RSI and the Stochastic is still
correct to test support level of 16488 / 4942. In addition,
intact which cannot be ignored.
we are observing a candlestick pattern which resembles a
“Spinning Top”. The said pattern will be confirmed ONLY if
Trading strategy:
indices break and sustains below 16488 / 4942 level. In
this case, indices can test recent bottom of 15765 / 4720.
Markets moved higher during the initial part of the week but
This pattern will get negated once prices break high of the
showed some positive momentum to register a weekly high
pattern which is 17210 / 5169. However, the positive
of 17210 / 5169. However, indices could not sustain near
crossover in Weekly RSI and Stochastic oscillator is still
this level as they were nearing strong “Horizontal Line”
intact. The impact of this crossover may be nullified once
resistance of 17300 / 5177. On Friday’s session after
indices break 16488 / 4942 level. On the upside, last week
reversing from mentioned resistance level, mainly due to
high of 17210 / 5169 would act as strong resistance. A
sell - off in Banking, Metal and Oil & Gas counters, we are
move beyond this level, indices may test 17300 - 17600 /
now witnessing a “Rising Wedge” continuous pattern. This
5200 - 5280 levels.
pattern has a negative implication.
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Technical Report
RESEARCH TEAM
Shardul Kulkarni
Head - Technicals
Sameet Chavan
Technical Analyst
Sacchitanand Uttekar
Technical Analyst
Mehul Kothari
Technical Analyst
Ankur Lakhotia
Technical Analyst
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