Major Indices :: Sensex : 16737 : Nifty : 4982
Intermediate Trend: Bearish
Key Technical Levels: 17413- on the upside, 16452-16400- on the downside
In the last review I said "the Sensex is resting exactly on the upper end of the parallel channel; technically this is a good opportunity for the bears, if they are in mood to fight back,otherwise it will be free walk for the bulls;trading below 17240, will be a setback for the bulls (may be temporary resting period) and in that case expect a dip up to 16900".
In reality, the bulls made an attempt to break this upward channel on a very first trading day of the week, but failed miserably to do so. This failure to sustain above the critical levels had provided fantastic opportunity for the bears to dominate. Subsequently, the stoploss at 17240 was broken, resultant we had witnessed a downswing which went below our target of 16900.
This sharp fall has altered the equations for the bulls, both at macro as well as micro levels. After a rally of almost 3000 points (from low of 14677-18th March), bulls failed to strengthen their position. One last hope(for the bulls) is at 16400-16452 level. If failed to protect, the Sensex will be in vulnerable situation. On the upside, trading above 17413 is critical for the bulls, but seems to be a difficult task, as of now.
Conclusion: After a 3000 points rally, the bulls failed to strengthen their position. This lack of commitments on the part of the bulls pointing towards a possibility of larger degree fall in the next couple of weeks. This argument will loose some value (not all) if the Sensex surpasses and trades above 17413 in the near term.
