Wednesday, June 2, 2010

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

 The System Signals a Buy .. !

Finally, as expected by the previous three posts, the Momentum Signal system has indicated a buy after a small correction. The Nifty futures never traded below the last closing price of 4940 on Wednesday indicating strength. This strength was seen even after the overnight losses in the US markets and it's effect  on the European markets when they opened. The trading was confined to a narrow range for most of the day  and the futures rallied in the final hour of  trading. It closed at 5014, near the day's high. The Nifty future is expected to test the resistances one by one now. However, everything related to trading still depends on the international cues which are as unpredictable as ever. 

Nifty Futures - Daily Chart     

As shown in the chart above , the next resistances are the 100 and 50 DMAs at 5102 and 5173 respectively. If the futures is able to cross these resistances, a target of 5250 to 5300 may be feasible. Readers of this blog may  note that the prediction of targets is hazardous task because anything can happen at any time changing the whole scheme of things. Hence, the Momentum Signal system tries only to follow the markets on a day to basis and never tries to predict the targets. 

World Markets

Even though the European markets traded lower in the initial parts of their trading day, they recovered most of their losses when US markets opened with positive bias. The FTSE, CAC and the DAX closed with very minor losses on Wednesday. The US markets were trading with gains of a percent at the time of this post on the back of data showing better than expected sales of pending homes and autos.

The Updated Momentum Signal Spreadsheet

The updated spreadsheet showing the Momentum Signal as on the close of  2nd June 2010, is given below.

 The Momentum Signal has returned a value of +100 indicating the maximum positive momentum.

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 June, 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.

  Please click on the table to enlarge. For more info on the above table,  please click here.
The closing values required as on the closing of trade on Thursday for the continuation of the positive momentum are below the current last traded prices.  

Cheers and Prosperous Investing and Trading !!!
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