- the early morning correction of 70 odd points was gobbled up in no time and we rallied 100 points from yesterday's close!
- the 50% retracement level at 3450 was scaled smoothly.
- resistance at 200dema was scaled too.
- support at 3307 mentioned since last two days held strongly.
- scaled downtrendline joining May 2008 and September 2008 tops.
Indications of a correction still exist
- negative divergences in intraday charts intact.
- rising wedge still threatens.
- as per past history we are due for a correction (up legs have consumed just 5 to 6 weeks mentioned in my weekly write up)
Looking at the pattern of the upmove 3650 should be the next stop which coincides with top on 14th October 2008 at 3648 . If this level is overcome then 3816 should be strong resistance as shown on daily fiboncci resistance chart.
Supports in case of a correction are 3400-3300.The rising wedge supports are at 3395-3450. Other support and resistance levels are marked on the chart.
Positional Longs could shift the stop loss to 3417 which was today's breakout point .
Happy Trading !!