mkt news

Market has been moving with violent volatility as reflected in ADX indicator.

(1) Today’s (22-10-2008) close has created Bullish Stick Sandwich pattern. Such patter is considered as reversal pattern. Candlesticker.com explains this pattern as under :

Explanation:

In the Bullish Stick Sandwich Pattern, there is a downtrend going on. Then prices open higher on the next trading day and they reach to higher levels all day, closing at or near the high. This bullish act suggests that the previous downtrend may now reverse implying that the shorts need protection. The next day, prices open at a higher level leading some shorts to cover their positions initially but then the prices start moving lower to close at the same price as two days ago. This pattern shows that the market is finding a support level and now the trend may reverse from this support level.

Important Factors:

A confirmation on the fourth day is required to be sure that the downtrend is reversed. Confirmation may be in the form of a white candlestick, a large gap up or a higher close on the fourth day.

NIFTY Chart of August to October with indicators

2. Such Bullish Stick Sandwich pattern seemed to have appear between 29-9 and 3-10 , however market slipped heavily therefrom.

3. ADX line is surprisingly moving sideways indicating good amount of movement on either side.

4. MACD histogram is in negative but indicating positive divergence.

5. Volume is somewhat decreasing which is good sign during bearish market.

CONCLUSION :

As the NIFTY appears to finding psychological support at 3000 and creating base there.

The Indian market opened on gap-down note and traded in red zone throughout the session .For coming session nifty is trading in narrow range of 200 point breakout below 3054 it can test 2940-2840 on the other side breakout above 3254 it will kiss 3400 levels.

Yesterday was move northwards, today southwards..the range 3050-3250 kissed both ways...Comeon guys .. whatsup??????? ...lets move on..next few days will be very crucial..if we break the lows , panic bottoms can be made as settlement approches..remember we are slipping from 1st day of this series ..trade carefully and with strict stoplosses as you can get whacked both ways in this madness...cheers