Wednesday, April 7, 2010

Update on The Ultimate Momentum Signal - 8th April, 2010

 Sensex Hits 18 K, But Another Doji in Nifty Futures...!

On Wednesday the BSE Sensex touched the 18000 mark after a long period of twenty four months. It achieved the feat immediately after the opening of trade. It revisited the 18 K mark at around noon while the S&P Nifty and Nifty Futures achieved fresh twenty four month highs of 5399 and 5398 respectively. However, markets traded downwards and the futures finally closed at 5381. In the process the futures formed another doji candle, a bit more long legged than the Tuesday's doji. Doji candles indicate indecision by the market. It can be a sign of weakness ahead. Meanwhile, Greek bond spreads are widening, indicating the higher risk perception by the international investors.

Nifty Future Daily Chart  

The  trailing valuation ratios of S&P  Nifty Index as on 7th April 2010 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  7th April 2010, is given below.

The Nifty Future has closed in the buy territory as on the close of 7th 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 8th April, 2010 are given in the table below. The table also include the projected closing values of BSE Sensex corresponding to 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 moved upwards and the triggers for a downtrend have also moved upward. The intraday trailing stop is raised to 5284 due to the new high. Traders are advised to be cautious as any weakness in the international markets may cause the end of the present unusually long grinding uptrend.
Cheers and Prosperous Investing and Trading !!! 

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