Monday, June 1, 2009

Of Bulls and Bears… Update for 01 Jun 09

The market is the king and no one or nothing else matters. Infact the markets have remained defiant of following any indicators at all. There is a reason for that and reason in justifiably good. We have had the GDP above the expected figures. The results of Sail, L&T and M&M were better than expected – the ministers generally shouted “Will Perform” in unison and FIIs continue with their buying spree. Then what the hell is wrong with me to be a pessimist? There is a talk of de-regulation of the govt pricing regime for Oil, There will be some anti dumping measures in steel and infrastructure will get a boost.

imageWell I would put it this way Firstly, the news – or the good part of it is now over – there are no more surprises or statements that will come out for some time to come. Oil deregulation part is good but had a look at the oil – inching above the 66$ per barrel mark? Steel taxes on cheap imports is good but realise that it will be expensive for the consumer who is already under pressure from spiked up real estate? Finally see the figures of FII and DII trading data? Net value is positive but do not ignore the sell value – it has been 5264.8 Cr. Once again the money flow from the FIIs is of the proportion that them going out will upset our cart. These are the reasons along with the technicals that make me say that – no down trend perhaps but a correction of 10-15% should be around the corner.

On the global cues front Asia closed with Nikkei up thee quarters of a percent, Hang Seng was up was up was up 1.6% and Strait Times were up 1.55%. Though the European markets did end positive – they closed around the lower levels. FTSE was up 0.69%, DAX up 0.16% and CAC up 0.43%. US traded the entire day along the flat line but ended positive – climbing at the last moment to end Dow green 1.15%, Nasdaq up 1.29% and S&P up 1.36%. In asia the market is trading green. Nikkei started red but quickly climbed up in green and is now at 0.79%, hang Seng is up 2.23% and Strait Times up 1.89%. Daily 29 May 09

As far as the charts are concerned – they remain bullish and overbought. From the beginning – let us see. The candles are bullish and nearing the upper range of the Bollinger bands. All lower EMAs are above the Larger figures so the uptrend continues. The volumes are good – 148% of the last 50 Day average and that is good. On ADX the +DI is above the –DI so it is bullish. The ADX (14) is at 25 and any drop lower will make it go into a range bound market. MACD is bullish without any iota of a doubt. Slow Stochastic is Bullish and so is RSI – the RSI is in the overbought territory. So most of the indicators do remain firmly bullish. It would be interesting to see the day unfold today. It should ideally open positive but am not as sure about the closing.

Put call ratio 29 May 09option pain 29 May 09 I Think that it is worth seeing Options data also check out the graphs…

And before I pen off the Pivot levels…

R3 4636
R2 4573
R1 4510
Pivot 4425
S1 4362
S2 4277
S3 4214
Projected High Range 4468 to 4542
Projected Low Range 4434 to 4360

Fib Projected high 4528

Fib Projected low 4299

I would wish everyone luck and may you all make money.