WEEKLY ANALYSIS FOR WEEK ENDING 03 JAN 2014

EVEN THOUGH NIFTY MADE A NEW LIFE TIME HIGH ON 9TH DECEMBER AT 6415 BY BREACHING THE 6 YEAR OLD 8TH JANUARY 2008 HIGH OF 6357, YET IT COULD NOT SUSTAIN AROUND THE NEW HIGH EVEN FOR A MINUTE AND CONTINUED TO FALL TILL 18TH DECEMBER LOWS OG 6130 SPOT LEVELS. THIS TYPE OF PROFIT BOOKING CORRECTION IS VERY COMMON I ALL MARKETS WHEN A NEW LIFE TIME HIGH IS MADE & ONE SHOULD BE ABSOLUTELY SURE TO SEE MANY MORE OF SUCH NEW LIFE TIME HIGHS FOLLOWED BY MILD CORRECTIONS TO COMPLETE THE BULL MARKET OF LIFE TIME BY 2016. HENCE ANY CORRECTION IN NIFTY BY 200 TO 300 POINTS IF AT ALL IT COMES SHOULD BE TAKEN AS A GOD SENT OPPORTUNITY FOR LONG TERM INVESTORS TO BUY AND HOLD. THE DOUBLE BOTTOM LOWS OF 5972 MADE ON 13TH & 22ND NOVEMBER SHOULD BE KEPT AS STOP LOSS FOR ALL LONG TERM POSITIONS A DECISIVE BREACH OF WHICH MAY SEE ANOTHER FALL OF ABOUT 250 TO 270 POINTS TOWARDS THE NEXT CRITICAL SUPPORT OF 5700 SPOT. IN ANY CASE FOR SHORT TERM OR EVEN MEDIUM TERM PLAYERS, A DECISIVE BREACH OF 18TH DECEMBER LOWS OF 6130 SPOT ON A CLOSING BASIS SHOULD BE ENOUGH INDICATION TO TRADE SHORT TILL ANOTHER LIFE TIME HIGH IS MADE ABOVE 6415 SPOT.

AS CAN BE SEEN IN THE DAILY CHART OF SPOT NIFTY ABOVE, NIFTY IS IN THE PROCESS OF AN UPWARD LOOKING CHANNEL WHOSE UPWARD TILTING RESISTANCE LINE IS FORMED BY JOINING THE 19TH SEPTEMBER HIGH OF 6142 & 3RD NOVEMBER HIGH OF 6343 & THIS RESISTANCE LINE WHEN EXTENDED POINTS TOWARDS 6600 & HIGHER LEVELS. SIMILARLY THE LOWER SUPPORT LINE IS FORMED BY JOINING THE 1ST OCTOBER LOWS OF 5701, 22ND NOVEMBER LOWS OF 5972 & 18TH DECEMBER LOW OF 6130 &

WEEKLY ANALYSIS FOR WEEK ENDING 06TH DECEMBER

AFTER THREE CONSECUTIVE WEEKS OF FALLS  DURING THE FIRST THREE TRADING WEEKS OF NOVEMBER, THE FINAL WEEK ENDING 29TH NOVEMBER HAD A BULLISH WEEKLY CLOSING FOR SPOT NIFTY BY CLOSING AT 6176 COMPARED TO ITS PREVIOUS WEEK ENDING 22ND NOVEMBER CLOSING OF 5995. WHAT IS MORE IMPORTANT IS THAT THE  20 WEEK EMA & SMA CONTINUE TO RETAIN THEIR SANCTITY, AS NIFTY SPOT SINCE THE WEEKENDING 11 OCTOBER HAS NOT BEEN ABLE TO TOUCH THESE TWO WEEKLY MOVING AVERAGES & NIFTY SPOT HAS CONTINUED TO STAY ABOVE THESE CRITICAL WEEKLY MOVING AVERAGES. THE OTHER IMPORTANT ASPECT OF THESE WEEKLY MOVING AVERAGES IS THAT 20 IS ABOVE 50 & BOTH ARE ALSO ABOVE THE 200 WEEKLY MOVING AVERAGES CONFIRMING THAT THE LONG TERM, MEDIUM TERM & EVEN THE SHORT TERM AS WELL ARE IN BULL GRIP.

THE WEEKLY RSI TAKING AN ABOUT TURN UPWARDS  TOWARDS 60 JUST BEFORE TOUCHING 50 MARK  IS ANOTHER CONFIRMATION SIGNAL THE BULLS MUST MAKE FULL USE OF TO BASH ON REGARDLESS INITIALLY TOWARDS THE CRITICAL 6212 SPOT FOLLOWED BY THE NEW LIFE TIME HIGHS MUCH ABOVE THE 8TH JANUARY 2008 HIGH OF 6357 SPOT. SO, UNLESS THERE ARE CATASTROPHIC EVENTS EFFECTING INDIAN ECONOMY  OR THE EXTERNAL OPERATORS & MANIPULATORS REALLY WANT TO SUPPRESS  INDIAN MARKETS FOR SOME MORE WEEKS TO CONTINUE LIFTING  OTHER MARKETS UP, THERE IS A VERY HIGH PERCENTAGE OF CHANCE THAT INDIAN MARKETS SHOULD SEE A NEW LIFE TIME HIGH BY END OF THIS YEAR.

IN THE DAILY CHARTS THE ROUTINE INDICATORS  LIKE MACD,  RSI,  STOCH  &  CCI   LOOK HIGHLY BULLISH FOR SOME MORE DAYS.  AFTER TWO DOJI DAYS ON 27TH & 28TH NOVEMBER, THE WAY FRIDAY’S GREEN CANDLE HAS OPENED & CLOSED MUCH ABOVE THESE TWO EARLIER DOJIS THAT TOO TO CLOSE NOT ONLY ABOVE   THE DAILY PIVOT BUT ALSO TO CLOSE FAR ABOVE THE IMPORTANT RESISTANCE LINE JOINING THE DECEPTIVE DIWALI 3RD NOV HIGH OF 6342 &  19TH NOVEMBER HIGH OF  6212, IS A  GOOD SIGNAL FOR SOME MEGA RISE & IS A CLEAR SIGNAL  FOR BULLS NOT TO ALLOW  THIS GOLDEN OPPORTUNITY TO SLIP OUT OF THEIR HANDS.  A RISE BY SPOT NIFTY TO HAVE A DECISIVE CLOSE ABOVE 19TH NOV HIGH OF 6212  MAY SEE  BEARS SCRAMBLING FOR COVER BY RESORTING TO MONSTROUS  SHORT COVERING OF  WHATEVER SHORT POSITION IF AT ALL THEY POSSESS AS OF NOW. HOWEVER A FAILURE TO BREACH AND MORE IMPORTANTLY TO SUSTAIN ABOVE THE CRITICAL 6212 SPOT WILL SEE THE BULLS GETTING MASSACRED DAY AFTER DAY,  AS IN THAT CASE AN INITIAL BREACH OF THE 27TH NOV DOJI LOW OF 6030 FOLLOWED BY   EVEN THREATENING TO RETEST & BREACH THE DOUBLE BOTTOM LOWS OF 5973 SPOT IS ALSO POSSIBLE.

AS PER THE WEEKLY & THE DAILY TECHNICALS, THE DOUBLE BOTTOM FORMED AT THE 5973 SPOT LEVELS IS GOING TO BE A FORMIDABLE SUPPORT FOR NIFTY SPOT FOR MANY MANY WEEKS & MONTHS TO COME THAT ENCOURAGES SWING TRADERS TO BOLDLY HOLD THEIR SWING LONGS. EVEN FRESHERS MAY LOOK FOR AN INTRADAY DECLINE TO INITIATE LONGS & HOLD THE LONGS  WITH STOP LOSS BELOW 27TH NOVEMBER LOW OF 6030 SPOT. A BREACH OF THIS INITIAL LOW OF 6030 WILL OPEN THE FLOOD GATES TOWARDS THE DOUBLE BOTTOM LOW OF 5973 SPOT & ONLY A DECISIVE CLOSE  BELOW THE DOUBLE BOTTOM LOW OF 5973 SPOT CAN SEE MUCH LOWER LEVELS .

SINCE 20 NOVEMBER, SPOT NIFTY HAD REMAINED BELOW BOTH THE 20 DAY EMA & 20 DAY SMA FOR 7 CONSECUTIVE DAYS & THE  123 BREAKOUT GREEN CANDLE OF FRIDAY HAS TAKEN SPOT NIFTY HIGH ABOVE BOTH THESE MOVING AVERAGES  &  THAT TOO, TO CLOSE FAR ABOVE BOTH THESE SETS OF MOVING AVERAGES& ALSO ABOVE THE DAILY PIVOT  IS ANOTHER BOOSTER DOSE FOR THE BULLS TO HAMMER THE BEARS OUT OF SHAPE.  THE RESISTANCE LINE NOW AROUND 6100 SPOT WILL