Daily Nifty – Feb 18
Click charts to enlarge
Chart 1 – Still a nicely buoyant market but take note of the overbought indicators. A little like the other Asian markets the Nifty has enjoyed a good run up but the signals are starting to turn and be cautious if you are long, it might be time to think about taking interim term profits.
The MACD signal is still the stronger signal but now the shorter term overbought indicators are getting much more powerful as you can see from the RSI and RIM in this chart.
You have to beware of a correction.
Chart 2 – The bounce back has broken the downtrend line and there was a week long hesitation at the old Fibonacci Projection level at 61.8 pct.
Higher volume has helped drive this as you can see from the volume study.
A break lower in line with last year’s downtrend is still very much on the cards with 4,785 being the most important as a break of this targets 4,187.
Chart 3 – The 30-day Correlation with theUS market has broken down and the market is moving under its own steam.
:b��’O� :��8ct target is in sight and that could well be the turning point for this market. As the market hits that level look at the MACD and the RSI for indications that we could be in for a correction to this latest rally.
The Alexander Filter is saying beware as it is high as well.
Chart 3 – The Wall Street correlation is very volatile at the moment.
