As I had mentioned earlier on the RIL post, that today was just the day which was long and frustrating. Below is the hourly chart of Nifty(please do scroll down and see the hourly I had posted on my weekend views post), we can see after the opening surge we just tried to surpass the 50 periods MA and spent most of the day there before giving up. This has once again led to a small reverse divergence on the charts. It’s like this, we all know that Momentum precedes price, in this case we have seen Momentum going higher and price failing to follow the Momentum. We have stalled exactly at the shaded area shown in my weekend post; this also was the 38.2% fib retracement from the recent lows. Now the price is nestled between the 20 and the 50 period MA, where as the 200 periods at 2825 and the 2850 above are the real challenges if one has to have any serious bullish fantasies. As for the supports if the 2715 doesn’t hold well then this time we are once again going to test the 2650 or perhaps lower.
So far we have held well vis a vis Dow, I wouldn’t worry much for DOW, as this is now testing and confirming the bottom going on. We are going to get the positive Momentum divergence on the weekly chart and hopefully things will become clearer then.
"Success usually comes to those who are too busy to be looking for it." Henry David Thoreau