Update for 11th April 2011

The Mild Correction to Continue ?  

• Though, some of the previous posts were very short, almost every one of them dealt with the resistance offered by the falling trend line obtained by the  joining of  the previous two highs.
• The earlier posts indicated that the resistance for Nifty futures is between 5950 and 6000. 
• No wonder, Nifty contracts slowed down at the resistance and a mild correction has started in the previous two trading days.
• European Central Bank's interest rate action, some hawkish comments on the interest rate front made by a US Fed official, the rising crude oil prices etc may hamper the present rally, at least in the short term. 
• Now the pertinent questions before the traders are :  whether the mild correction will continue or not in the current week, and if yes, which are the  reasonable support levels !  Let's check the various charts to find  a possible answer !

  Nifty Futures - Intra-day Chart

• The intra-day chart of Nifty futures show the way of the mild correction which on at present. Once Nifty futures broke previous two day low of 5880 levels, it remained below the level for the entire day on last Friday.

   Nifty Futures  - Daily Chart 

Update for 8th April 2011

A Mild Correction is On? 

• It seems that the mild correction as envisaged in the yesterday's post is on now. The supports and resistances given in the previous post remain valid and are reproduced below. 
• Major lower support for the Nifty contracts are at the 5700 to 5750 levels.
• Above these levels, minor supports are available at 5800 and 5850.
• Please note our the preferred view for the market is for some more consolidation between the 5700 and 5950 levels in the immediate future.
• Traders and investors may take note of the first raising of interest rates done by the European Central Bank after the big bear market, which may signal the start of the monetary tightening process in the developed economies. It is natural for equities to under perform in a rising interest rate regime. 
• This late update of the Momentum Signal trading system  contains only the basics of the system due to some time constraints. Please bear with the author.   

     Nifty Futures - Intra-day Chart