Sunday, May 2, 2010

Update on The Ultimate Momentum Signal - 3rd May, 2010

 The Sell Signal is Still Hanging In ... ! 

Last Friday, the Nifty futures opened with some positive bias as expected and traded just below the first resistance of 5278 for around 30 minutes. However, it cleared this resistance in the first attempt itself and traded above the resistance for a significant time period. However, the futures failed to bridge the last Wednesday's gap of 20 points fully, as it could not trade towards the top end of the gap at 5298. ( See previous posts ). As the futures failed to test the gap, it traded lower at the fag end of the trading and closed within the sell territory of the Momentum Signal system. Even though the underlying index closed in the neutral territory, the BSE Sensex closed in the sell area. It is again clarified that the closing values corresponding to the BSE Sensex momentum is being published  only for the purpose of confirmation of the signal emanating from the Nifty Futures either with the underlying index or with the BSE Sensex. 

Nifty Futures - Daily Chart   

The technical position of the market has not changed during the past two trading days. The resistances at the 5298 to 5310 range remain the same.  
World Markets

Even though some of the Asian markets closed with gains on last Friday, all major western markets closed with losses. The US markets have recorded their first weekly loss in the ninth week after continuously gaining for eight weeks.  Because of the increasing fears of a sovereign debt crisis, the CBOE VIX index gained 19.6 % last Friday and closed at 22.05 %. The S&P 500 index was trading just above it's support at the 1080 to 1083 range. It is reported that an agreement to bailout Greece by the EU - IMF combine may be announced by late Sunday in Europe. This may give further cues to the market on Monday.

The Updated Momentum Signal Spreadsheet

The updated spreadsheet showing the Momentum Signal as on the close of  30th April 2010, is given below.

Projected Momentum Signal Close Values

The projected levels of closing values corresponding to the momentum shift / neutrality / continuation as on the close of trading on 3rd May, 2010 are given in the table below. The table also include the projected closing values of BSE Sensex corresponding to the momentum shift / neutrality / continuation signals.
 You can click on the table to enlarge. For more info on the above table,  please click here.

The closing values required for the resumption of the uptrend have decreased and the closing values for the continuation of the downtrend have remained almost static.  However, the closing values for a -100 momentum signal have decreased significantly.

The stop loss point for the short positions in the futures is brought down to the Friday's high of 5290 and is to be strictly followed.

Please do write in your suggestions and comments about this blog.
Cheers and Prosperous Investing and Trading!!!  

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