Technical Analysis of Indian Equities by Nooresh

Its not Over, Till its Over — Stay calm on sidelines.


Sensex Technical View:

Sensex has come down to the band of 17700-17800 but not seeing any respite and in a downtrend one should not try catching a falling knife. Let the markets stabilize.

RSI is giving signs of positive divergences but no other positives seen.

Technically there is a minor support at 17500-17400 but the next major support comes at the lower trendline and the previous channel which is roughly placed at 17000.

Major fibonacci retracement for the move comes at 16100.


On the upside till we dont close above last 2 days high we cannot consider any positive momentum. For now such a level comes to 18200. Also markets on the upside may get limited to 18800 which was the breakdown level.


As mentioned ever since 19900/19000 the view has been maintained to keep 50% or much higher cash for investors. Although the prices might be tempting right now but a breakdown below 17800-17700 also opens a possibility of a flash crash to lower levels with some negative announcements.

Also its clear with the magnitude of the fall that markets may not get into a V shape reversal soon and investors may get opportunities to get back. So one may be very selective and continue to wait for turnaround signals.

Buying a little higher is more comfortable then to catch a falling knife and get hurt. None of the supports have been respected so the correction is not over till its over. And when its over we will get good turnaround signals on technicals and market observations.





Recently a few days back we expected a bounce back and had focussed on RIL, ICICI , SBI and Hindalco as best bets. Got a 5-10 % jump on Hindalco, SBI small move, RIL and ICICI we preferred to exit on cost as still not comfortable on turnaround signals.


Reliance Inds as you see above after an initial move up could not cross was not a great signal. We may watch for a move above 950 to confirm positive moves. A move below 900-890 can even take it to 850.


Stocks to watchout for :
ABAN OFFSHORE has given a breakdown sell on rise stop 650 tgt 600-580

Many Banks like BOI, UCO bank, all bank , Yes Bank have given breakdowns and can head lower it seems.

Short trades seem to be clear on technicals but the positive divergences on Index makes it a bit risky but momentum traders can keep looking for quick shorts.


Bottomline :
When in Doubt Stay Out -

If you are not in the market all you can lose is an Opportunity, But Hanging around for no reason can cost you badly.


TECHNICAL ANALYSIS TRAINING DELHI  tentatively planned for February 25-26 for more details call Kazim 09821237002

Article by Nooresh Merani

Nooresh has written 2799 articles.

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{ 17 comments… add one }
  • vivek February 9, 2011, 00:35

    Hi Nooresh,
    My portfolio has become Half . You had told that Sensex will touch 23000 soon but when? I did not book any profit. Or it will not get there .I am very much in tension

  • Arun Karthik February 9, 2011, 10:04

    Hello Nooresh,

    Hope you are doing good.. I’m writing to you after a long time.. Should I now go by saying – ‘ Buy when everyone is selling’ and take a risk??

    • Preeth February 12, 2011, 01:05

      I would say, be selective and SIP your selected stock.

  • luis da silva February 9, 2011, 11:40

    Hi, Nooresh,

    i am looking at 2 stocks as i am 100% in cash. BILCARE & RELIANCE CAPITAL. What are your views on these two stocks? look forward to your reply.

    • Preeth February 12, 2011, 01:04

      Analyse YESBANK and ELGIEQUIP or WHIRLPOOL, that is good bet.

  • preya grehwal February 9, 2011, 17:43

    mr nooresh
    warm regards , i am regular reader of ur web , the current correction of the markets has beenn quite deep in the sense that index has coorected some 15% but all stocks touching 52 week low , this is quite worrying , could u plz explainn what it indiacates on technical terms and where can market head inn this scenario. your kind views are solicitated , also a small point , some stocks are still trading at thier 52 week highs or near to them in this markets , so what should be the strategy on them as no stocks are been spared…

  • Jonty February 9, 2011, 22:34

    Dear Nooreshbhai .

    Let us see what we see.Trader is trader he is never bull or bear . Remember elliot Wave ., At 6338 B was competed. and C started .
    first leg 6338 – 5690 . 2nd gave 74.6 percent retracement in zig zag manner . 5690 – 6181.
    Now 3rd in progress which could reach 5111 . which is 1.618 times 1 st leg .
    Sir If you can see hourly chart . every retracement and impulse have followed fibo.

    • nooresh February 10, 2011, 12:56

      Hi Jonty,

      On an Elliot Basis my earlier assumption was B wave is not over till we confirm below 18800 which was done since 19900/19000 have been on very high cash. Majority of the readers are investors and not leverage traders or FNO participants. So view is with a bias of market outlook.

      For now C can end at 16100 or lower but yes intermediate bounces can come. Elliot Wave options keep changing 🙂

      The view is simple trend is down and we dont go fight it.



      • jonty February 10, 2011, 21:55

        Hi Nooresh bhai,

        When market was reaching 6338 volumes were low compared to earlier 6357 , which was indication that the move from 2250 – 6338 is B and not next uptrend .
        And now my view is nifty might come again till 2500. A = C ., within this year .
        Considering Global markets . are almost reaging their retracement levels . of 76.4. Dow 12400 , S & P 1360. Only indian market has given 100 percent retracement.

        Some stocks have given irregular top e.g. Sbi .
        As per Elliot tenets in case of irregular B , i.e. above 5 th wave top. correction should be sharp . same is the case of Sbi. .

        All the above analysis is working well for me . Thanks to you for trading techniques . And thanks to Robert Beckman . for writing such a wonderful book giving in depth knoledge of EW analysis . I am achieving almost exast highs and lows of the moves.
        this is not a n advertisement of vision books. But I personally feel if a brilliant person like you study that book it would be very helpful for many people .

        Thanks for reply.

        • nooresh February 11, 2011, 10:04

          Hi Jonty,

          Lets c i have a bullish count on Sensex and consider the triple correction got over in March2009.

          Will checkout that book let me know if u have an e book.



        • Amit February 13, 2011, 11:30

          Pls provide link to me also, or mail me the e-book on

  • shivaji February 9, 2011, 23:52

    Hi Nooresh, sesnsex clearly broken 17,800 for 2 days and weekly close below 17,800 confirms end of medium to long term trend but one thing i have noticed is that there are many stocks whose primary trend is still on upside like Tata Steel, Hindalco , TCS , Wipro etc etc . How do u read such situation 🙂

    • nooresh February 10, 2011, 12:54

      Hi Shivaji,

      Trend is weak there are no two ways about it.
      Well when a ship sinks everything goes with it so i would wait for markets to stabilize.



  • shivaji February 9, 2011, 23:57

    Positive divergence is also violated today and RSI made lower low confirming downtrend. but as you said 17,500 or 17,000 we can expect bounce….

    • nooresh February 10, 2011, 12:30

      Hi Shivaji,

      We need to watch for confirmation after divergences. Markets can remain oversold for longer time then we can think.

  • vivek February 10, 2011, 00:03

    Hi nooresh,
    My portfolio has become HALF . I have not booked any profit as you told that sensex will touch 23000 soon. Tell me whether 23000 will come in 2011 or not. Should I book losses or wait for your target.

    • nooresh February 10, 2011, 12:27

      Hi Vivek,

      My view had been that Sensex may do a high again ! which dint go but being a trader/investor have advised to exit 50% + position for investors at 19900/19000 levels. For traders we took long exits at 19900/19000 completely. Also at 20500 i had advised people to exit leverage positions.

      The decision to sell is most difficult.

      For now 17800 is broken which was last hope. Now we may look to enter on panics only or on turnaround.

      technically logical level next is 16100 in worst case.




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