Tuesday, August 3, 2010

Update on The Ultimate Momentum Signal - 3rd Aug. 2010

 Nifty Probing the ( New ? ) Highs ... !!!

In the last fifteen days, the Nifty futures have recorded it's second failure in it's probe to the 5350 levels. As is usual for any trading markets, the next step is to probe the other side. Hence the rally on Monday, the first trading day of the new calender month. By the time the trading opened, the Asian markets were trading robustly in the positive territory giving very strong positive cues to the markets. The futures opened near the top end of the previous day's trading range and closed at the highs. The Nifty future is set to probe the recent high of 5475 and if it is able to break the resistance it may even reach the next resistance area between the 5500 to 5550 levels. In the end, the expected cliffhanger trading day ended without any suspense ... !!!

Nifty Futures - Daily Chart 

World Markets

Most markets have rallied in the second half of the last month and are trading at or near their two and a half month  highs. On Monday, the European market indices, FTSE, CAC and DAX  closed with  strong gains of 2.65, 2.99 and 2.34 percents respectively. The US markets were also trading with gains of 1.50 to 2.00 percents at 11.30 PM IST. The Dow Jones index was trading at a new  two and a half month high, at time of this post.

Updated Momentum Signal Spreadsheet

The updated spreadsheet showing the Momentum Signal as on the close of  2nd August, 2010, is given below.
The Momentum Signal closed in the neutral territory as on Monday.
Projected Momentum Signal Close Values

The projected levels Momentum Signal values applicable to various ranges of closing values of the Nifty Futures, Nifty Index and the BSE Sensex,  as at the close of next trading day, ie. as on  3rd August, 2010, are given in the following table. 
  Please click on the table to enlarge. For more info on the above table,  please click here.  
Readers of this blog may please note the following  'Risk Factor' which is being  repeated almost daily these days. The markets are trading in small ranges at the top end of a slow climb and for all practical purposes the trading is range bound. Range bound markets are not suitable for the Momentum Signal system too.
"As the Momentum Signal is primarily a trend following system, it may indicate whipsaw signals in range bound markets. As such, all readers of this blog are requested to read the various pages describing the system and understand all the intricacies of trading the Momentum Signal and it's risk factors too. Please do write in your comments and suggestions."

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