Tuesday, April 6, 2010

Update on The Ultimate Momentum Signal - 7th April, 2010

Dow Just below 11 K and Sensex below 18 K....!

The Dow Jones Industrial Average ( DJIA ) and BSE Sensex are both trading just below big round numbers with low volumes and low volatility. However, in major headlines, the name of Greece is again to the fore...!  Investors are selling Greek assets and moving the money to international banks like HSBC, says a report. In another news there are apprehensions raised about the Greek bailout by the EU - IMF combine. Bank for International Settlements ( BIS ) says that most industrialized countries have extended in their borrowings or are likely to be extended in the future.  Currencies are trading in a volatile fashion. The rise of Indian Rupee is helping the FIIs.  And that rounds up the general maket conditions at present.

Meanwhile the Nifty Futures closed very near to the Monday's close forming an evening star doji candlestick. Is it a sign of weakness ahead ?
Nifty Futures - Daily Chart

The Nifty future has support at the previous high of 5305 - 5310 area. It is also supported by the upward moving regression channel. The intraday trailing stop remains at high minus 2.1 % i.e. at  5274. Also see the last table for the closing values required for the upward momentum as per the system.

Meanwhile the market valuations have reached the top end of the normal bull market intermediate highs. Please also refer to the Nifty Fundas page for more information. The  trailing valuation ratios of Nifty as on Tuesday are given in the table below.

Source : NSE India

The Updated Momentum Signal Spreadsheet

The updated spreadsheet showing the Momentum Signal as on the close of  6h April 2010, is given below.

The Nifty Future has closed in the buy territory as on the close of 6th April, 2010.

Projected Momentum Signal Close Values

The projected levels of closing values corresponding to momentum shift / neutrality / continuation as on the close of trading on 7th April, 2010 are given in the table below. The table also include the projected closing values of BSE Sensex required for momentum shift / neutrality / continuation.

 Please click on the table to enlarge. For more info on the above table,  please click here.

The closing values required for the continuation of the uptrend have remained almost static and the trigger for a downtrend has moved slightly downward. Caution is the name of the game from here onwards.

Cheers and Prosperous Investing and Trading !!!  

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