WEEKLY OUTLOOK: 13APR TO 17APR 2009

(Please click on chart to enlarge)

All charts' source: Quote.com

U.S. DOW (8083)

This index has been closing above its 50dma for the last three weeks but failed to close past our given resistance at 8088. After hitting this resistance it is now halting just below that. The momentum looks strong enough to surpass this hurdle soon.

VIX (CBOE Volatility Index) has moved down to 36 levels but the earnings season can cause intraday high volatility. Momentum Indicators are not portraying a clear picture. But it seems that most of the bad news has been factored into the markets already because only the positive news of even lesser significance is causing bears to take shelter.

Resistances for the week are at 8088, 8132 and 8524. Failure to move above 8132 has the potential to pull it down once again. But a close above this level would target 9000 in the short term.

Supports are at 7762, 7685 and 7470. Short term bulls may exit below 7685. Medium term support below 7470 would be at 7278 which has to hold so as to maintain the uptrend.
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U.K. FTSE (3984)

This index was not able to give a close above 4070 though it made attempts over the last two weeks to do so. Its 50dma also lies in this zone. So, if it gives a close above 4070-4085 zone then it could be headed towards 4300 to 4600 levels.

Momentum Indicators are pointing positively. The other solace is in the fact that its down trend last week was accompanied by low trading volume. But it now needs to surge past with large volume to display some strength. Otherwise, this is the weakest market among the lot here.

Resistances for the week ahead are at 4000, 4070-4085 zone. A close above this zone would target 4212 and then 4334.

Supports would be at 3930, 3879 and 3799. Short term traders may avoid fresh longs below 3799.

Though seems unlikely so soon, if it breaches 3719 on the downside, would imply more pain in the offing for this index.
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INDIA NIFTY (3342)

This index is the darling of derivative traders. The trading volume has increased manifold suddenly as market players start gathering courage. But the things are happening too fast here and that demands caution now. A correction looks imminent as it formed a doji on its daily charts. Also that the RSI is in overbought zone and there is negative divergence in ROC.

Resistance zone is 3440-3451. If manages to close above here then the next target would be 3734. Even the target of 3900 would also come into the reckoning, if above 3451.

Supports would be at 3233, 3181 and 3129. Short term traders may avoid initiating fresh longs below 3181. But the medium term turns overtly negative only on a close below 2850.
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INDIA SENSEX (10804)

There was no let up in the gusto though the momentum indicators are now signaling that its time to cool down a bit. Overall, this market is strongest among the lot here in the current situation. But it reversed from 10929 –tad above our given resistance 10924 of last week. It implies that it might enter into a short term correction mode anytime soon.

(We have Infosys results coming on Wednesday, which would determine the course for the week ahead. Currently at 1426, Infosys is experiencing stiff resistance from 1450 level).

Resistance for SENSEX is at 10929-10954 band. A move above this band would target 11375 and then 11639.

Supports are at 10391, 10225 and 10060. Short term traders may avoid fresh long positions below 10225. Medium term turns negative only on a close below 9488.
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HONGKONG HANGSENG (14901)

Here also the momentum indicators are giving mixed signals.

Resistances are at 15147, 15525 and then 15764-15781 band. A move above this band would make attempts towards its 200dma at 16480.

Supports would be at 14484, 14279 and 14076. Avoid fresh longs below 14279.
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CHINA SHANGHAI (2444)

In an effort to somehow move above 2460, this index seems to have started losing momentum. The zone from 2460 to 2475 is proving to be formidable resistance as it got repulsed from 2457. Yet, this is its short term outlook only and the medium term is still very positive.

Resistance zone is 2460-2475. A move above here would bring the targets of 2726 and 2976 into the reckoning.

Supports would be at 2297, 2240 and 2197. Short term traders may desist from initiating fresh longs below 2240. However, the things turn overtly negative only on a close below 2037.

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JAPAN NIKKEI (8964)

Profit booking on Friday accompanied by good volume could be a cause of concern in the near term. But the technical outlook has not turned negative for this index in short to medium term yet. However, we should always be prepared for short term corrections during such gusto in the markets.

Resistances are at 9069, 9325 and 9520. Area of 9500-9600 is a formidable resistance zone. If it manages to close above this zone then the next target of 10000 would come into the reckoning.

Supports are at 8694, 8578 and 8463. Short term traders may not initiate fresh longs below 8578. But this index turns negative only below its medium term support at 8088.

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