Mirror mirror on the wall..... till where will the nifty fall?

Ha... don't see the topic -- I wrote it as it rhymed well and its good to Boo people early in the morning. The charts do not look as bad as yesterday and daybefore. There is some positive indications. Till when or till where will these take us -- is yet to be seen.

I will just talk about one candle formation -- the hammer. Yesterday on nifty a hammer has been formed that should ideally signal the end of this downtrend that we saw for past so many days. So a reversal of sorts should be on our hands. Mind you the pattern is good and strong but could have been better had we had a white real body than a black body. ....And to those who read my post yesterday... I had actually expected a peircing pattern. That entailed that the market should have ideally gone up after opening steadily and closed near its top. Then when I pondered over the charts I found that barring the discussion between the hammer and a peircing pattern -- it is actually good that we tested the bottom it formed on apr 7th. (4629 on 7th and 4634 yesterday). So today I do expect a recovery... mind you that does not take into consideration a fuel price hike to be announced today.

I would ideally want the nifty closing to be above 4869 for the recovery to be meaningful. And I do feel that it is achievable. The problem is that oil issue has become too complicated to be fully factored in with or without the price hike.

Other than what I have wirtten above the market continues to be weak. Jaggu (thankfully posted the TRIN yesterday) says TRIN is bearish. MACD, TRIX and RSI are not good.

To my mind the volume is slightly up and I see it as good as the resistance to fall was with slightly better volumes than yesterday. As also expected yesterday StochRSI has again generated a buy signal. The low of Apr 07 has been tested and with half a heart we can probably classify it as a double bottom. The divergence on MACD has widened and in the recent past this has been the average. With divergence reducing the fast line may attempt to go above the slow line in future and that will be good.

Now I will take on the second part that I saw on the charts today. Uma's blog recommended ACC. The candles do give a buy on the stock for the following reasons. Firstly, it has made a reversal pattern that actually I was expecting for Nifty -- that is Peircing pattern. It is a fairly strong signal and is the pattern made is a typical textbook like, so may give good relief for those holding on or to those who jumped in the ACC bandwagon yesterday. I see it going upto 700 (touching the 38.2% Fabonacci retracements). TRIX seems to have bottomed, stochastic is buy, RSI says buy and MACD weak buy signal. My only worry in all this is that StochRSI is at 100. it will have to hover above 80 minimum for some time to remain positive.

US closed in red and the Nikkei is green, hang seng red and strait times confused. Best of luck to all.