Weekly Market Outlook 11-15th Jan 2010

On weekly charts Nifty closed forming a doji similar to gravestone doji.

Since it is not a gravestone doji it does not signify much in terms of technical analysis and next weeks outlook is a bit confused.

The next week closing on weekly basis will confirm  the future course of action and a similar closing will make head and shoulder doji which confirms weakness.

Since Nifty touched the significant level of 5300, some correction was bound to happen.

Nifty need to consolidate here if it is going to touch fresh high levels.
Without some consolidation those highers levels are difficult to sustain.

We expect Nifty should correct upto 5155 level before it may rise further.

Higher level targets are placed at 5331; 5379 and 5417.

On weekly charts Nifty also has strong support at 5203 and breach of this level on closing basis may drag Nifty further to above mentioned level of 5155.

For the bullish momentum to continue Nifty must hold level of 5130 and breach of this level may create some real panic in the market.

In worst of conditions Nifty must hold 5088 which is 10-Week Exponential Moving Average.

Any time Nifty breached and close 10-week EMA we have seen strong correction in last 5 year.

Its better to watch out for some correction and wait to buy at lower levels.