Friday, March 26, 2010

Update on The Ultimate Momentum Signal - 26th March, 2010

 The Breakout - Day 17
Shall We Test the Previous High....!

"The reports of my death have been greatly exaggerated. "

This is a comment supposed to have made by Mark Twain when someone queried him about some false news about his death.
Similarly, the present uptrend is still on and any news of it's end is also greatly exaggerated.  The Nifty futures opened lower in tandem with the Asian markets and later on rallied on Thursday, the expiry day. The current month futures closed at 5260. The next month futures closed at 5277 with a premium of 17 points.
On Thursday, the European and the US markets were trading at new  eighteen month highs on the news of a possible IMF backed rescue of the debt ridden Greece and infusion of fresh money by the Dubai government in to Dubai World. Meanwhile, Chairman Ben Bernanke of the US Federal Reserve reiterated that extremely low interest rates will persist for an extended period. All western markets are trading with positive momentum even though the eastern ones are a bit lagging now.
The Nifty futures may test the January, 2010 highs in the coming days. Meanwhile, it is reported that the turnover of the B Group shares have started exceeding the turnover of the bigger and higher capitalised companies in the Bombay stock exchange. Moreover, the advance decline ratio also seems to be a bit lagging the uptrend. These two factors are not very encouraging signs.
                        Nifty Futures - Daily Chart   

As the technical position of the market hasn't changed, the resistance and the trailing stop remains at the previously published levels of 5305 and 5170 respectively.

The Updated Momentum Signal Spreadsheet 

The updated spreadsheet showing the Momentum Signal as on the close of   25th March 2010, is given below.
The value of the Ultimate Momentum Signal has remained in the bullish territory for the seventeenth day after triggering a buy signal on the budget day, the 26th of February.
 Projected Momentum Signal Close Values

The projected levels of closing values required for momentum shift / neutrality / continuation as on the close  of trading  on 26th March 2010 are given in the table below. The table also include the projected closing values of BSE Sensex required for momentum shift / neutrality / continuation.
  You can click on the table to enlarge. For more info on the above table,  please click here.

Please note that the minimum closing values required for keeping the Momentum Signal in the buy mode ( i.e. above +50 ) has gone up to 5275 and 5259 for the futures and the underlying index respectively and these values are approximately at the Thursday's closing values.

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