Reigning The Nifty - 24th May , 2010

 Weekly Chart

Daily Chart

 Half Hourly Chart

 Weekly Charts

• Nifty closed down, below the trendline joining lows from 3918.
• This was the sixth consecutive week of fall, maximum duration among corrections since March lows.
• Oscillators are weak and have moved below their lows made in Feb 2010.Stochastic  has reached oversold zone.
• Volumes for the week was high  and breadth very poor.

Daily Chart

• Hammer formed at crucial support of 4844.
• The bounce was  from the trend  line joining lows made during the fall from 5400.
• Close above 200dema though intraday panic broke the support.
• Positive divergence in Rsi 14 intact.Stochastic has reached oversold zone.
• Volumes were good and breadth was poor.
• AD line has fallen to it's lowest level since September 2009.

Half Hourly Charts

• Oscillators moving up after showing positive divergence.
• Maintained close within the falling channel.

The Nifty is in a downtrend for the sixth consecutive week. Oscillators have started showing positive divergence . Stochastics on the weekly and daily charts have reached oversold zone. The daily charts show a hammer formed at good support. The Bullish Hammer Pattern is a significant candlestick that occurs at the bottom of a trend or during a downtrend and it is called a hammer since it is hammering out a bottom.The hammer has been  formed after violating the 200 dema  intra day and  recovering sharply from the lows of 4842. 

The above indications point at the probability of  a short term bottom having been formed  at 4842. Hammer patterns need confirmation with a bullish candle the next trading day.Watch out for a bullish day on Monday. 


Happy Trading !!
Lakshmi Ramachandran
www.vipreetsafetrading.com