PREMIUM NEWSLETTER
In last week’s premium newsletter i had given the astro outlook for the markets and mentioned that after 12th feb , a sharp rally in asian indices will be seen.
And after 15 th and 20 th feb ,important astrological dates, some stability in the markets will be seen.
When everyone was engrossed in fear and were talking of a drastic fall and created a hype of 200 DEMA , I told you all about the dates of reversal and nifty levels and on Friday , I even told you all the time for reversal.
I have always told you to avoid rumours … so what’s now
Last week, the Sensex opened at 17427.34 and fell to a low of 16457.74. Further, it recovered to a high of 18142.92 and closed the week at 18115.25 and thereby showed a net rise of 714 points on a week-to-week basis. The recovery from the low of 16457 to 18142 shows some ray of hope but a lot of restoration work is needed as the resistance is hanging overhead.The first resistance is from the island reversal formation which has a gap at 18274-18509. This island reversal is not the classical text book style nor is it 100% perfect in terms of location and occurrence but its effect was witnessed as the market had a slide down to 16457. Resistance of the gap of 18274-18509 will be on important resistance this week.A trend line on the daily chart drawn from the top of 21206 and high of 20985 will offer resistance at 18300 on daily charts, which coincides with the gap of 18274-18509.Retracement levels of the fall from 21206 to 15532 are placed at 17580, 18274 and 18968. The high registered last week was 18142, which is above 17580 and now the next level to watch out will be 18274 and 18968.If we ignore the low of 15532 and take the higher bottom of 16457 as the low for a retracement of the fall from 21206 to 16457, then the pull back levels will be placed at 18274, 18834 and 19395. The pull back retracement level of 18274 and 18834 coincides with the resistance gap of 18274-18509.The lower top for the Sensex is placed at 18895, which has almost tested the 0.618(golden ratio) level of fall from 21206 to 15532.
The golden ratio of 61.8%, always keep this in mind.
This ratio is always maintained, when the markets fell , it took supports at 61.8% retracement levels , when the markets are rising from the current fall on January 21 and 22 , the rise is near to 61.8% retracement levels where it will face resistance.On the other hand, support will be in the range of 17464-17200, 16729-16608 and 15532. The Sensex did well last week and hung on to the 200 day SMA (Simple Moving Average). It did close below it for a day but remained around the 200 day SMA to get back strong support to the market.
Astrologically mercury is retrograde and will straighten on 20th feb ,which will bring stability to maket , refer to last week’s premium newsletter.Overall, we might get a pull-back to higher resistance levels but sustainability is the issue and the rise can create a bull trap.A weekly breakout and close above 19000 may just save the market from a bear grip. A weekly close above 19000 is required on Friday or ideally above 19400. If that happens, then the Sensex will not only test the top of 21206 but could cross it convincingly to move towards 24840.
For any queries feel free to call at 09874152486
Regards,
Pankaj poddar
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