BSE-SENSEX-A TECHNICAL UPDATE-18-1-2016

BSE-SENSEX

Closed at 24455.04 on 15-1-2016

SUPPORT: -24530/24387.69/24163.62/24156.47/24020/22912.52/22286.26/22197.51/21573.48.

RESISTANCE: - 24833.54/24867.73/24878.66/24892/25018.46/25232.82/25287.33/25298.42/25453.32.

 (Figures in bold are important)

 After two days of see saw movement it gave breakdown today. It closed near the low of the week with a loss of more than 300 points, furthermore it is below its entire short and long term moving averages, it is well below its one of the most important level of 24833.54 valid for the entire year of 2016 for the 2^nd consecutive day and most importantly today it has broken its yearly rising trend line drawn from the bottom of 8047.17 of 2009 which is at 24530 for the year 2016 is a very bad sign and indicates gross weakness in it. Technically it is already on a weak footing and if it maintains below 24530 then the on –going fall may continue for few days before it takes a breather and moving down it will find potential support from it threshold point for entering it into bear market which is at 24020 and sustained break below this could trigger bigger fall which may please be noted. Please note that it will show some respite if it maintains above 24530 and show some strength if it moves and sustain above 24833.54.It is needless to mention here that the long term trend is down. Therefore long call should be avoided now and can only be tried at the lower levels if visible sign of some kind of bottom formation emerges or else try if it moves and sustain above 24833.50.

Remark:-The long term trend is down. It was a breakdown today and break below yearly trend line is highly concerning and the overall technical setup is extremely weak, therefore long call should be avoided till it exhibits visible strength.

Kindly note that make your cost your stop loss in favorable  trade and then trail it as the price move up/down to gain maximum profit and avoid losses. Use support and resistance levels as entry, exit, target and trailing stop loss points. DO NOT TRADE WITHOUT STOP LOSS.

Disclaimer:-The view expressed here are solely of the author and he is not at all responsible in any way for the outcome of the trade you enter based on the above view.

Note: Price stated here is of spot market.

Contact me for strategic guidance to enter and exit the trade.