Insight into why the NIFTY is probably heading down

[rajadawn]

Please see the attached image. Nifty is following a channel of about 200 points width. This is a little unusual movement upwards but understandable. On one hand there is pressure of technical forces which is making it move towards 5200 whereas there are unusually bad news of sovereign default emanating from the 'PIGS' of Europe. My take is that the bad news is trying to disturb the upward movement and hence such a wide channel. I guess the upward momentum will also get depleted by the time it touches 5200 for these reasons only.

 

[rajadawn]

Please see the attached image. Nifty is following a channel of about 200 points width. Usually upward movements are narrow and sharp. This is a little unusual movement upwards but understandable.

On one hand there is pressure of technical forces which is making it move towards 5200 while on the other hand there is unusually bad news of sovereign default emanating from the 'PIGS' of Europe. My take is that the bad news is disturbing the upward movement (much like opposing winds shake a plane violently during flight) and hence such a wide channel. I guess for this 'opposing force' disrupting a 'smooth upward climb' the upward momentum will also get depleted by the time it touches 5200 for these reasons only.

 

[rajadawn]

Going by analysis of past patterns of RSI during an upswing I have concluded that nifty would move to 5700-5800 during the next 15 days at least (likely to be 18/19 days) before starting to reverse directions.