Archives : WATCH OUT FOR BEAR ATTACK - 12/09/2008
WATCH OUT FOR BEAR ATTACK – 12/09/2008.  

Markets are behaving in a perfect technical manner, otherwise who would have dreamt that Sensex and Nifty will be breaking previous intermittent lows after reaching highs of 15107 and 4558 on Monday. On Monday the international market was terrific, the crude had a decent fall, the NSG had passed the India proposal and bail out of Freddie and Fannie all helped our market reach higher on Monday. But alas as the week progressed the market started giving up its gains and day after day it started breaking important support levels only to end lower. Friday seemed like Bears were showing full power as the Sensex broke its previous intermittent low of 14002 and closed just below it. In the process the uptrend which had begun from 12514 for the Sensex and 3790 for the Nifty has ended.

 

This is a classic Bear market and the traders would do well to remember that the Bears will not just go away and yield the ground to the Bulls as this is their time, their playground and last but not the least this is their market, which has come after a long wait of 5 years.

 
  • BEAR MARKET: GOOD NEWS IS REASON TO SHORT.
  • SENSEX.
  • NIFTY.
  • LAST WEEK’S RECOMMENDATIONS:
  • THIS WEEKS RECOMMENDATIONS:
  • WATCH OUT FOR :
    • RELIANCE INDUSTRIES
    • DLF

  • CLICK MORE FOR FULL ARTICLE



WATCH OUT FOR BEAR ATTACK – 12/09/2008.  

Markets are behaving in a perfect technical manner, otherwise who would have dreamt that Sensex and Nifty will be breaking previous intermittent lows after reaching highs of 15107 and 4558 on Monday. On Monday the international market was terrific, the crude had a decent fall, the NSG had passed the India proposal and bail out of Freddie and Fannie all helped our market reach higher on Monday. But alas as the week progressed the market started giving up its gains and day after day it started breaking important support levels only to end lower. Friday seemed like Bears were showing full power as the Sensex broke its previous intermittent low of 14002 and closed just below it. In the process the uptrend which had begun from 12514 for the Sensex and 3790 for the Nifty has ended.

 

This is a classic Bear market and the traders would do well to remember that the Bears will not just go away and yield the ground to the Bulls as this is their time, their playground and last but not the least this is their market, which has come after a long wait of 5 years.

  BEAR MARKET: GOOD NEWS IS REASON TO SHORT.  

This is a Bear market and the good news as we all know will get discounted. The Bears will treat any good news as an opportunity to go short at higher levels. The case in point is what happened on Monday. All the good news combined only allowed the market to go up for a day and then the Bears took control and enjoyed the whole week by shorting. The same thing happened again on Friday as the Inflation data (12.10% which reduced for the third consecutive week) and the much better than expected IIP data (7.1% v/s 5.4%) did nothing but raised hopes of a rebound and the market went up for sometime and the Bears pounced again on this opportunity to short the market.

 SENSEX.  

Sensex opened the week at 14978, made a high 15107, low of 13933 and closed the week at 14000, thus registering a weekly loss of 483 points. Sensex has formed a Bearish Engulfing candle on the weekly charts. The MACD and the ROC has given a SELL signal on the daily charts. The intermittent uptrend which started from 12514 has ended as the sequence of higher tops and higher bottoms is interrupted. Also the Sensex has moved and closed below the important level of 50dma which is at 14301. The Sensex has left a gap between 14557-14609 which will act as strong resistance going ahead.

Sensex has formed a Bearish Head and Shoulders Pattern and the implications will be visible in the coming days and weeks as the Sensex seeks lower levels and in the process makes a mockery of the important support levels. Trendline Support for the Sensex will be at 13458 and 12605. Trendline Resistance will be 14241-14559-14952.

For the week ahead, Sensex has Resistance at 14284-14557-15107. Support is at 13727-13458-13042-12301. 

 

 NIFTY.  

Nifty opened the week at 4358, made a high of 4558, low of 4200 and closed the week at 4228, thus registering a weekly loss of 124 points. The indicators, pattern analysis suggest that the short term uptrend has ended and continuation of the down fall. The Nifty is well below the 50dma which is at 4294.

Nifty OI PCR is at a low of 0.94, which suggest that the Put writers have lost confidence as the Nifty continues to seek lower levels. Nifty has added good open interest at the strikes of 4300 and 4400. It will prove to be strong resistance going forward. Trendline Resistance is at 4350-4529 and Trendline Support is at 4089-3959-3776.

For the week ahead. Resistance is at 4309-4350-4529. Support is at 4159-4089-3959-3776. 

LAST WEEK’S RECOMMENDATIONS:

GGGGGGGreat simply as the followers made money irrespective of the market direction. Mostly all targets were achieved.
  • BUY JET @ 540 TGT 558 REACHED 563.
  • SELL ORCHED @ 240 TGT 230 REACHED 228.
  • BUY UTV @ 808 TGT 823 REAHCED 820.
  • SELL HDFC @ 2281 TGT 2200 REACHED 2165.
  • BUY IOC @ 446 TGT 458 REACHED 455.
  • SELL TATA STEEL @ 560 TGT 527 REACHED 520.
  • BUY HOTEL LEELA @ 33.80 TGT 36.75 REACHED 36.75.
  • SELL NIFTY FUT @ 4366 REACHED 4216.

If one had followed and done the pairs then the profit from all the Four pairs together would be Rs. 73,155/- in such UNCERTAIN & VOLATILE conditions.

 THIS WEEKS RECOMMENDATIONS:
  • SELL RELIANCE 1932 SL 1980 TGT 1892-1839-1795.
  • SELL REL 929 SL 975 TGT 900-876-836.
  • SELL TCS 810 SL 835 TGT 782-757.
  • SELL HDFC 2182 SL 2236 TGT 2148-2062.
  • SELL DLF 466 SL 478 TGT 450-439-422.
 

WATCH OUT FOR :

  • RELIANCE INDUSTRIES
  • DLF
 
Disclaimer : The recommendations made herein do not constitute an offer to sell or a solicitation to buy any of the securities mentioned. No representations can be made that the recommendations contained herein will be profitable or that they will not result in losses. Readers using the information contained herein are solely responsible for their actions. Information is obtained from sources deemed to be reliable but is not guaranteed as to accuracy and completeness.

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