Stock Market Chart Analysis: 09/08/10

September 8, 2010

S&P 500 hour chart is trading in a range of 14 points. 1091 - 1105.
Right now it is trading close to the upper end of the trading range.
Index may pause around 1105 region and may be followed by a correction. Indicators are also in the overbought zone in hour chart.
If 1105 is broken convincingly we can see a rally of 10 points.

S&P 500 futures went down till 1086 after breaking the support line.
1085 area has given support for the index.
An hourly close above the trend line shown in the chart will be positive for the index.
The above chart is a continuation of the hourly analysis shown in this POST.

CHART - III

NF Got resisted near the top of the pattern is now moving towards the support line.

CHART-II

CHART - I

Again its one of those broadening patterns this one in 15 minutes chart.
Remember we have one going in the daily chart which was posted today.
Violation of support or resistance lines can give good direction for the short term.

NIFTY DAILY CHART

NIFTY WEEK CHART

Nifty daily chart is looking positive with the index closing above the broadening pattern. Now the index should trade above 5600 for the bullishness to continue.
Any dip below 5600 will be negative.
Nifty's weekly line chart is showing a breakout above the resistance line.
This week should close above 5550 for the breakout to sustain on closing basis. If nifty comes back and closes below 5550 we may not have a breakout on weekly closing basis.
The worst scenario for bulls would be a whipsaw in weekly chart which can have catastrophic results like what we had back in 2008.

S&P 500 has closed the day below the crucial 61.8% Fib level.
But the index is still trading above 20 and 50 DMA. This should keep the bulls interested.
50 DMA is at 1082 if this level break the correction can be big.
The daily chart also has a negative sma cross, 20 DMA is below 50 DMA.
Today bears had an upper hand but i still feel that both trades are possible from here. clarity should emerge soon.