Con­sol­i­da­tion con­tin­ues till 34600 is not vi­o­lated

Money Times - - Trading On Technicals -

Last week, the Sen­sex opened at 36396.69, made a high at 36446.16 and moved to a low of 35266.72 be­fore it closed the week at 35673.25 and thereby reg­is­tered a net fall of 521 points on a week-to-week ba­sis.

We have seen op­po­site clos­ings in al­ter­nate weeks since the past 3 weeks be­cause of which the Sen­sex wit­nessed side­ways volatil­ity. The rate of change ev­ery week over the last three weeks has been -1.44%, 3.47% and -1.34%. The net ef­fec­tive rate of change over 3 weeks is 0.61%, which demon­strates side­ways move­ment. The band of move­ment cre­ated is 36446-34672.

Daily Chart

The daily chart sup­port and higher bot­toms are at 35266, 34896 and 34672. The fall wit­nessed in the last few days was from 36446 and 35266. The 61.8% re­trace­ment level is placed at 35995.

Weak­ness may re­sume be­low 35266. Till 35266 is not vi­o­lated, ex­pect a rise to 35995.

Weekly Chart

In the last edi­tion, we had men­tioned that the rise wit­nessed two weeks back was of 1,213 points and a dip was an­tic­i­pated to the sup­port level.

The sup­port level of 35826-35263 was for ac­cu­mu­lat­ing. The low reg­is­tered last week was 35266 while the weekly clos­ing was at 35673.

An al­ter­nate bear­ish and bullish can­dle was seen over the last 3 weeks, which re­sulted in side­ways volatil­ity with­out much weekly gains in this 3-week sce­nario. The gain in the last 3 weeks was just 0.61%.

The bear­ish can­dle last week sug­gests that re­sis­tance will re­main at the higher range till a break­out and weekly close above 36446 is not wit­nessed.

The re­sis­tance lev­els for the week are placed at 35795-36324-36446-36841-36945. Broadly, till 37000 is not crossed, the ob­jec­tive re­mains to book prof­its in the higher range and trade long at lower lev­els till 34672 is not vi­o­lated.

The sup­port lev­els are placed at 34896-34672.

BSE Mid-Cap In­dex

Weekly chart:

An en­gulf­ing bear­ish can­dle on the mid-cap in­dex sug­gests re­sis­tance in the higher range and sell­ing till 15162 is not crossed.

The re­sis­tance lev­els are placed at 14830-15048.

The lower range is 14499-13950.

BSE Small-Cap In­dex

Weekly chart:

A bear­ish can­dle sug­gests that the re­sis­tance lev­els of 14249-14418 and the lower range of 13935-13453 could be tested with volatil­ity.

Strat­egy for the week

Traders long can main­tain the stop loss of Sen­sex 34600.

The re­sis­tance lev­els are placed at 35795-36324-36446. Traders can book prof­its at 36324 and re-en­ter long if the weekly close on Fri­day is above 36446.

Traders can buy above 36446 with the low of the week as the stop loss or 35266, whichever is lower.

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