FIIs were net buyers of equity on Wed. and Thu. (Feb 12 and 13) but net sellers on Mon., Tue. and Fri. (Feb 10, 11 and 14). Their total net buying was worth Rs 0.11 Billion. DIIs were net sellers of equity on Mon. and Thu., but net buyers on the other three days of the week. Their total net selling was worth Rs 7.93 Billion, as per provisional figures.
India's CPI-based retail inflation moved up to 7.59% in Jan '20 from 7.35% in Dec '19. WPI-based wholesale inflation also rose to 3.1% in Jan '20 from 2.59% in Dec '19. The Index of Industrial Production (IIP) contracted 0.3% in Dec '19 against a growth of 1.8% in Nov '19.
Exports fell 1.66% to US $25.97 Billion while imports slipped 0.75% to $41.14 Billion in Jan '20. The trade deficit widened to a 7 months high of $15.17 Billion. A combination of rising inflation, widening trade deficit and contracting production does not augur well for India's economic growth.
BSE Sensex index chart pattern
The daily bar chart pattern of Sensex closed above its three EMAs in long-term bull territory, eking out a gain of 115 points on a weekly closing basis. The index is trading just 1000 odd points below its lifetime high of 42274 touched in Jan '20.
Daily technical indicators are looking neutral to bearish. MACD has crossed above its signal line and moved up to the '0' line. RSI is falling towards its 50% level. (Since Nov '19, MACD and RSI have been showing negative divergences by forming bearish patterns of 'lower tops, lower bottoms'.) Slow stochastic has dropped down from its overbought zone.
Declining stocks were outnumbering advancing stocks during the week gone by, making the current rally unsustainable for long. Heavyweight stocks like RIL, HUL are keeping the index afloat as the broader market continues to slide.
[There are signs of a reversal pattern formation in progress at the index top. It could be a 'broadening top' or a 'diamond'. If either of the patterns play out, there could be a sharp index correction below the 200 day EMA.]
Q3 (Dec '19) results season is almost over. Results have been more or less as per lower market expectations, with a few positive earnings surprises on the back of corporate tax rate cuts.
It is not an appropriate time for bargain hunting when an index is trading near a lifetime high. For long-term investors, waiting patiently for lower levels to add is often more rewarding.
NSE Nifty index chart pattern
The weekly bar chart pattern of Nifty closed above its three weekly EMAs, but formed a 'doji' bar that indicates indecision among bulls and bears. A bullish pattern of 'higher tops, higher bottoms' - formed during the past 18 months - shows that bulls are controlling the chart.
The index is trading just 300 odd points below its lifetime high. Till it crosses convincingly above 12500, caution is advised due to a slowing economy and a rapidly spreading corona virus in China that is affecting global supply chains.
Weekly technical indicators are looking neutral to bearish. MACD has crossed below its signal line after falling from its overbought zone. RSI has moved above its 50% level but its upward momentum has stalled. Slow stochastic has fallen below its 50% level after forming a 'double top' reversal pattern inside its overbought zone.
Nifty's TTM P/E moved up to 27.45, which is well above its long-term average in overbought zone. The breadth indicator NSE TRIN (not shown) is oscillating about the edge of its oversold zone. More near-term index consolidation is likely.
Bottomline? After touching lifetime highs in Jan '20, Sensex and Nifty charts have been in consolidation modes. With very few positive triggers left for the stock market in the near-term, the indices can drift down. Investors should increase liquidity by booking profits wherever available.
FIIs were huge net buyers of equity on Mon. Sep 23, but were net sellers on the next two trading days this week. Their total net buying was worth Rs 15.1 Billion. DIIs were net sellers of equity on Wed. Sep 25, but were net buyers on the first two trading days. Their total net buying was worth only Rs 22.8 Million, as per provisional figures.
The government is expecting a Rs 400 Billion shortfall in GST collections during FY 2019-20 due to the economic slowdown. That could put pressure on the compensation that state governments are liable to receive in case tax growth falls below 14% for the year.
India's apparel exports have revived by 4% YoY during the Apr-Jul '19 period after two consecutive years of de-growth of 3-4% per year. However, ICRA has reported a likely slowdown in growth during the rest of FY 2019-20.
The daily bar chart pattern of Nifty shows how the Finance Minister's fourth 'booster' dose - a cut in corporate taxes announced on Fri. Sep 20 morning - has turned around the bearish sentiment prevailing in the market.
A short-covering frenzy erupted, and the index soared like a rocket past its 200 day EMA and the upper Bollinger Band. Nifty gained more than 550 points (5.3%) in one day.
There was more fun and games on Mon. Sep 23. Huge FII buying propelled the index higher with an upward 'gap' of 90 points. Nifty tested the 11700 level intra-day and closed with a gain of more than 300 points.
Sanity prevailed on Tue. Sep 24. The index formed an indecisive 'doji' and closed just 12 points lower but still traded above the upper Bollinger Band.
Both FIIs and DIIs were in profit booking mode today (Wed. Sep 25). Nifty fell sharply below the upper Bollinger Band and partly filled the 90 points upward 'gap' formed on Mon. Sep 23.
Daily technical indicators are in bullish zones. MACD is rising above its signal line. RSI has made a U-turn before it could reach its overbought zone. Slow stochastic is inside its overbought zone, but has turned down. Some more correction or consolidation is possible.
Nifty's TTM P/E has slipped down to 25.92, but remains inside its overbought zone and higher than its long-term average. The breadth indicator NSE TRIN (not shown) is hovering near the edge of its oversold zone, hinting at some near-term index consolidation.
The post-budget downward 'gap' of 26 points can provide resistance on the upside, in case bulls get adventurous again. The corporate tax cut has come as a sentiment booster to the stock market, but is unlikely to stimulate consumer demand in the near term.
A silver lining is that the festive season is almost upon us. Urban consumers may be able to open their purse strings - thanks to their Diwali bonuses. It is doubtful that rural consumers will be able to do likewise.
Small investors should avoid falling into the trap of 'buy' calls and big upside targets being suggested by experts on TV and pink sheets. An index barely 5-6% below its lifetime high is not providing a 'great buying opportunity'.
Stay invested, continue with your SIPs, get rid of non-performers in your portfolios, and be very selective in what you buy.
FIIs were net sellers of equity on all three trading days this week. Their total net selling was worth Rs 26.1 Billion. DIIs were net buyers of equity on all three trading days. Their total net buying was worth Rs 27.9 Billion, as per provisional figures.
RBI's transfer of Rs 1.76 Trillion surplus to the government has drawn wide-spread criticism from 'Harvard economists'. It is unfortunate that the first action of the 'hard work economists' to tackle the economic slowdown was to put their collective hands inside RBI's till.
As per Moody's, the 'booster package' announced by the Finance Minister on Fri. Aug 23 may boost investor and business sentiments, but won't be able to prevent India's GDP growth to slip to 6.4% for FY 2019-20.
The following remark was made in last week's technical update on the daily bar chart pattern of Nifty: "Nifty's previous (Aug 5) low of 10783 may get tested, and breached."
The day after breaking out below a 'rising wedge' pattern, the index fell below its Aug 5 low of 10783 and closed just below the lower Bollinger Band at 10741 on Thu. Aug 22.
On Fri. Aug 23, Nifty touched an intra-day low of 10637 but bounced up on short-covering after rumours of a 'booster package' from the Finance Minister - forming a 'reversal day' bar (lower low, higher close) that often marks an intermediate bottom.
The effect of the 'booster package' - announced after close of trading on Friday - lasted two days. On Mon. Aug 26, Nifty rallied strongly and closed above its 20 day SMA (middle Bollinger Band - marked by green dotted line).
There was some follow-up buying on Tue. Aug 27, but the index formed a 'doji' candlestick that indicated uncertainty among bulls and bears. An intra-day pullback to the 20 day SMA today and some short-covering before tomorrow's monthly F&O expiry took the index to a close just below 11050.
A dark cloud of resistance is looming overhead (marked by grey oval) - consisting of the upper Bollinger Band and rapidly merging 50 day and 200 day EMAs. The 'death cross' of the 50 day EMA below the 200 day EMA will technically confirm a bear market.
Daily technical indicators are giving mixed signals. MACD is rising above its signal line in bearish zone. RSI has started to fall after facing resistance from its 50% level. Slow stochastic has risen to the edge of its overbought zone. Any further index rally is likely to be short-lived.
Nifty's TTM P/E is at 27.33, which is inside its overbought zone and much higher than its long-term average. The breadth indicator NSE TRIN (not shown) is falling inside its oversold zone, hinting at some near-term index up side.
The 'booster package' from the Finance Minister came 'too little, too late'. No major reform announcements were made. The 'low hanging fruit' (RBI surplus) has been plucked. It will be interesting to see what happens next if the economy continues to slide.
FMCG giant HUL has announced 20-30% price cuts on soaps. Maruti has announced lay-offs. Q1 (Jun '19) results showed continued tepid earnings growth. The only 'animal spirits' visible are of the bearish kind.
WTI Crude Oil chart
The daily bar chart pattern of WTI Crude Oil bounced up from the support zone (between 50-52) and rose smartly above its 20 day and 50 day EMAs before facing stiff resistance at the 200 day EMA.
After two consecutive closes just above the 200 day EMA in bull territory on Jun 26 and 27, oil's price dropped down to seek support from its 50 day EMA on Jun 28. It bounced up to close just below its 200 day EMA on Jul 1.
Daily technical indicators are looking neutral to bullish. MACD is above its rising signal line in neutral zone. RSI is moving sideways above its 50% level. Slow stochastic is sliding down inside its overbought zone.
Falling volumes during the technical bounce may encourage bears to defend the 200 day EMA vigorously.
On longer term weekly chart (not shown), oil's price faced strong resistance from its 200 week EMA and dropped to close just above its 20 week EMA in long-term bear territory. Weekly technical indicators are at their respective neutral zones. Only Slow stochastic is showing upward momentum.
Brent Crude Oil chart
The daily bar chart pattern of Brent Crude Oil bounced up from the support zone (between 58-60) and rose above its 20 day EMA, only to face strong resistance from its 50 day EMA.
For the past seven trading sessions, oil's price has been consolidating sideways between its 20 day and 50 day EMAs. On Jul 1, it formed a long-legged 'doji' candlestick pattern that indicates indecision among bulls and bears.
Daily technical indicators are giving conflicting signals. MACD is rising above its signal line in bearish zone. RSI is moving sideways along its 50% level. Slow stochastic is poised to drop down from its overbought zone. Some more consolidation or correction is likely.
On longer term weekly chart (not shown), oil's price faced resistance from its 200 week EMA, and closed below its three weekly EMAs in long-term bear territory for the fifth straight week. Weekly technical indicators are in bearish zones. Only Slow stochastic is showing some upward momentum.
S&P 500 index chart pattern
The following comments appeared in last week's post on the daily bar chart pattern of S&P 500: "The week's rally was accompanied by sliding volumes. A pullback towards the down trend line is a possibility."
The index touched an intra-day high of 2911 on Tue. Jun 11, but pulled back towards the (purple) down trend line, forming a 'reversal day' bar (higher high, lower close).
A sideways consolidation in a range of 20 points (2875 - 2895) followed. The index closed above its three EMAs in a bull market, and eked out a 0.5% weekly gain.
Daily technical indicators are in bullish zones, but not showing any upward momentum. MACD has crossed above its signal line to enter bullish zone. RSI is moving sideways above its 50% level. Slow stochastic is moving sideways inside its overbought zone.
Some more consolidation is possible before the index attempts to scale a new high.
On longer term weekly chart (not shown), the index closed above its three weekly EMAs in a long-term bull market, but formed a 'doji' candlestick indicating indecision among bulls and bears. Weekly technical indicators are looking bullish to neutral. MACD is moving sideways below its signal line. RSI has moved above its 50% level after falling below it. Slow stochastic has moved up to its 50% level after falling below it.
FTSE 100 index chart pattern
The following comments appeared in last week's post on the daily bar chart pattern of FTSE 100: "Near-term index upside may be limited. Sliding volumes during last week's rally can encourage bears to 'sell on rise'."
The index touched an intra-day high of 7421 and closed just below 7400 on Tue. Jun 11 - negating the bearish 'head and shoulders' pattern (refer last week's post). Bulls failed to press home their advantage, and bears stepped in to sell as expected.
The index received support from its 20 day EMA, and closed above its three EMAs in bull territory. Strong volumes on the two down days indicate bears are in no mood to give up without a fight.
Daily technical indicators are in bullish zones but showing downward momentum. MACD crossed above its signal line to enter bullish zone, but is turning down. RSI is falling towards its 50% level. Stochastic has slipped down from its overbought zone.
A fall and a test of support from the 200 day EMA may be on the cards.
On longer term weekly chart (not shown), the index closed above its three weekly EMAs in long-term bull territory, but formed a 'shooting star' candlestick pattern that can trigger some correction or consolidation . Weekly technical indicators are in bullish zones, but not showing any upward momentum.
FIIs turned net buyers of equity on Mon. and Tue. (May 20 and 21), but were net sellers today. Their total net buying was worth Rs 19.5 Billion. DIIs were net sellers of equity on all three trading days. Their total net selling was worth Rs 17.9 Billion, as per provisional figures.
According to the World Economic Situations and Prospects (WESP) 2019 Mid-Year Update released by the United Nations, strong domestic consumption and investment will continue to support India's GDP growth, which is projected at 7% in 2019 and 7.1% in 2020.
The debt crisis in IL&FS translated into higher borrowing costs and reduced market access for other NBFCs, adversely impacting the growth of the NBFC sector - as per a report by Fitch Ratings.
Exit polls predicting a comfortable victory for the NDA in the recent general elections encouraged FIIs to go on a buying spree. The daily bar chart pattern of Nifty formed a 165 points upward 'gap' on Mon. May 20, and closed above 11800 for the first time ever.
FII buying continued on Tue. May 21. The index touched a new lifetime high of 11883.50 during early trading, but dropped down to close at 11709 - forming a 'reversal day' bar (higher high, lower close) that often terminates an intermediate up move.
Today's trading formed a 'doji' candlestick - which indicates indecision among bulls and bears - and a Nifty close below 11750 for the second straight day. The index traded well above its three rising EMAs in a bull market.
Nifty had broken out below a 'diamond' reversal pattern on May 6. The subsequent correction had found support near the upward 'gap' formed on Mar 12. A convincing move above 11750 - the level corresponding to the right apex of the 'diamond' - is necessary for bulls to regain control of the chart.
That should be a foregone conclusion if the actual general election results correspond to the exit poll predictions of a comfortable NDA win.
Daily technical indicators are looking bullish. MACD has crossed above its signal line to enter bullish zone. RSI is moving sideways above its 50% level. Slow stochastic has risen sharply to enter its overbought zone.
All three indicators are showing negative divergences by failing to touch new highs with the index. Some consolidation or correction may follow.
Nifty's TTM P/E has moved up to 29.22, which is in overbought zone and much higher than its long-term average. The breadth indicator NSE TRIN (not shown) is falling inside its oversold zone, hinting at some near-term consolidation/correction.
The opposition parties are trying to put up a brave face despite the adverse exit poll predictions. However, the writing seems to be on the wall. Even if NDA misses out on a clear majority, many of the smaller opposition parties are likely to be lured to the NDA fold before government formation.
Monday's buying euphoria was overdone. The large upward 'gap' of 165 points, with strong volume support, has the trait of an 'exhaustion gap'. There may be some more profit booking after election results are announced on Thu. May 23. Stay on the sidelines till the dust settles.
S&P 500 index chart pattern
The following comments were made in last week's post on the daily bar chart pattern of S&P 500: "A new high is now within handshaking distance. But bears are still not ready to throw in the towel."
The index consolidated sideways within a 26 points range - touching an intra-day high of 2918 on Wed. Apr 17, but forming a 'reversal day' bar. The index closed just 2 points lower on a weekly basis.
For the past seven weeks, the index is trading within a 'rising wedge' pattern, from which a downward breakout is likely.
Daily technical indicators are in bullish zones but showing slight downward momentum. MACD has slipped below its signal line. RSI again faced resistance from the edge of its overbought zone. Slow stochastic is correcting inside its overbought zone.
All three EMAs are rising and the index is trading above them in a bull market. However, negative divergences visible on all three indicators - which failed to rise to new highs with the index - can trigger a correction.
On longer term weekly chart (not shown), the index closed above its three weekly EMAs in a long-term bull market, but formed a 'doji' candlestick that can have bearish implications. Weekly MACD is rising above its signal line bullish zone. RSI is moving sideways above its 50% level. Slow stochastic is well inside its overbought zone.
FTSE 100 index chart pattern
The daily bar chart pattern of FTSE 100 consolidated sideways within a 66 points range during the Easter holiday-shortened trading week. The index gained about 23 points (0.3%) on a weekly closing basis.
All three EMAs are rising and the index is trading above them in a bull market. Volumes remained low - as there was little follow-up buying before a long weekend.
Daily technical indicators are in bullish zones but showing slight downward momentum. MACD has slipped below its signal line. RSI faced resistance from the edge of its overbought zone and dropped down. Stochastic is correcting inside its overbought zone. Some correction or more consolidation is likely.
On longer term weekly chart (not shown), the index closed well above its three weekly EMAs in long-term bull territory. Weekly technical indicators are looking bullish. MACD is rising above its signal line in bullish zone. RSI is above its 50% level. Stochastic is well inside its overbought zone.
FIIs were net buyers of equity on Mon., Tue. and Fri. (Apr 1, 2 and 5) but were net sellers on Wed. and Thu. (Apr 3 and 4). Their total net buying was worth Rs 9.7 Billion during the week. DIIs were net buyers of equity on Thu. but net sellers on the other four days. Their total net selling was worth Rs 6.7 Billion, as per provisional figures.
Nikkei India's Services PMI slipped to 52.0 in Mar '19 from 52.5 in Feb '19. It was the slowest growth (a number above 50 indicates growth) since Sep '18. The Composite PMI (Manufacturing + Services) fell to 52.7 in Mar '19 from 53.8 in Feb '19.
After cutting repo and reverse repo rates by 25 bps (0.25%) - acknowledging a slowdown in India's growth momentum - RBI has lowered the GDP growth forecast for FY 2019-20 to 7.2% from the earlier estimate of 7.4%.
BSE Sensex index chart pattern
The daily bar chart pattern of Sensex rose to touch a new lifetime high of 39270 on Wed. Apr 3 but formed a 'reversal day' bar (higher high, lower close) that often terminates an intermediate up trend.
After a pullback to the top of the large upward-sloping channel on Wed. Apr 3, the index dropped inside the trading channel on follow-up profit booking by FIIs on Thu. Apr 4.
The index moved up to the upper edge of the channel on Fri. Apr 5 as FIIs turned net buyers once again, and is trading well above its three rising EMAs in a bull market.
Is the index forming a large 'double top' reversal pattern? It is a bit too early to call. There are two technical 'rules' for confirming a 'double top': (1) lower volumes during formation of the second top; (2) an index fall below the 'valley' point (33292 touched on Oct 26 '18) between the two tops.
Neither of those two 'rules' have been followed so far. A more likely near-term possibility is some profit booking and an index fall towards the 125 points upward 'gap' formed on Mar 12 '19.
Daily technical indicators have corrected overbought conditions. MACD is about to cross below its rising signal line in bullish zone. ROC is facing resistance from its falling 10 day MA in bullish zone. RSI and Slow stochastic have fallen down from their respective overbought zones.
The stock market has 'memory' - because traders remember the level of the previous top from where a sharp correction had started. Psychologically, they tend to book profits when the index is at or near a previous top.
Therefore, some more correction or consolidation can be expected - specially with results season coinciding with election season. Small investors would do well not to dive into the market now. A SIP approach may work better.
NSE Nifty index chart pattern
The weekly bar chart pattern of Nifty closed higher for the 7th week in a row, as FIIs remained net buyers. The index also managed to close above the upward-sloping trading channel for the 2nd straight week.
The breakout above the channel still isn't a convincing one, though the index did touch a new high (by 0.8 points). Follow-up buying from FIIs was weak. Nifty formed a long-legged 'doji' candlestick, which is a sign of indecision among bulls and bears.
An observant analyst posted on twitter that the previous (Aug '18) top was preceded by 8 weeks of a corrective move followed by 23 weeks of rally. The Apr '19 top was also preceded by 8 weeks of sharp correction followed by 23 weeks of rally.
It is one of those interesting coincidences that sometimes happen on price charts, but doesn't have any particular technical significance. The index is trading above its weekly EMAs in a bull market. A big correction may or may not occur - but if it does, it should be used as a buying opportunity.
Weekly technical indicators are looking bullish and overbought. MACD is above its signal line and rising towards its overbought zone. ROC is above its 10 week MA, and is well inside its overbought zone. RSI is moving sideways above the edge of its overbought zone. Slow stochastic well inside its overbought zone, and is also moving sideways.
Nifty's TTM P/E has moved up to 29.12, which is well above its long-term average in overbought zone. The breadth indicator NSE TRIN (not shown) is in neutral zone after rising sharply from its overbought zone. Some index consolidation or correction can be expected.
Bottomline? Sensex and Nifty charts are hovering near the upper edges of their respective upward-sloping trading channels, and may face some consolidation or correction before moving up further. Avail dips to add.
FIIs were net buyers of equity on all four trading days. Their total net buying was worth Rs 71.0 Billion during the week. DIIs were net sellers on all four trading days. Their total net selling was worth Rs 45.2 Billion, as per provisional figures.
According to IMF, India has been one of the fastest growing large economies in the world. Though important reforms have been implemented, more reforms are needed to sustain the growth rate.
Fitch Ratings have cut India's GDP growth forecast for FY 2019-20 to 6.8% from its previous estimate of 7% due to weaker-than-expected momentum in the economy.
BSE Sensex index chart pattern
In a 'Holi'day-shortened trading week, the daily bar chart pattern of Sensex continued its upward climb on the back of strong buying by FIIs. The index made back-to-back attempts (on Wed. Mar 20 and Fri. Mar 22) to breakout above the upward-sloping channel, but failed.
On Friday, the index touched an intra-day high of 38565 - its highest level in more than 6 months - but closed 400 points lower on profit booking. The formation of a 'reversal day' bar (higher high, lower close) can trigger some consolidation or correction.
Daily technical indicators are looking bullish and overbought. MACD is above its rising signal line in bullish zone, but its upward momentum has stalled. ROC has crossed below its rising 10 day MA inside its overbought zone, and showed negative divergence by falling during the week. RSI and Slow stochastic remain well inside their respective overbought zones.
All three EMAs are rising, and the index is trading well above them in a bull market. A likely pullback - to fill the 'gap' zone (between 37106 and 37231) formed on Tue. Mar 12 - can be an entry opportunity for those who missed out on the 3200 points rally from the Feb 19th low.
Inventory pile-up at auto dealerships and production cuts announced by a few OEMs are clear signs that the Indian economy is slowing down. Small investors should think twice before joining the bandwagon of FII buying. Protecting profits is more important than making them.
NSE Nifty index chart pattern
The weekly bar chart pattern of Nifty closed higher for the fifth week in a row. After breaking out above the upward-sloping channel intra-week, the index slipped down to close within the channel - forming a 'doji' candlestick.
Weekly technical indicators are looking bullish and overbought. MACD is rising above its signal line in bullish zone. ROC is above its 10 week MA and moving sideways inside its overbought zone. RSI is facing resistance from the edge of its overbought zone. Slow stochastic has re-entered its overbought zone.
After touching a high of 28.27 on Tue. Mar 19, Nifty's TTM P/E has slipped a bit to 28.08, which remains well above its long-term average in overbought zone. The breadth indicator NSE TRIN (not shown) is moving down towards its overbought zone. Some index consolidation or correction is likely.
Bottomline? Sensex and Nifty charts are facing resistances from the upper edges of their respective upward-sloping trading channels, and are likely to consolidate or correct a little before moving up to test their lifetime highs. Dips can be used as entry opportunities.
Gold chart pattern
The daily bar chart pattern of Gold bounced up from the lower Bollinger Band and crossed above its 50 day EMA, but faced strong resistance from the middle Bollinger Band (20 day SMA, marked by green dotted line).
Gold's price is consolidating near the 1300 level, and managed to close well above its 200 day EMA in bull territory.
Daily technical indicators are looking neutral to bearish. MACD is moving sideways below its signal line in bearish zone. RSI is facing resistance from its 50% level. Slow stochastic remains in bearish zone after recovering from oversold condition.
After a sharp rise above 97.50 on Mar 7, the US Dollar index has dropped below 96.50. That helped gold's price to rally from its Mar 7 low of 1281.
On longer term weekly chart (not shown), gold’s price closed above its three weekly EMAs in long-term bull territory for the 12th week in a row. Weekly technical indicators are showing downward to sideways momentum in bullish zones, hinting at more consolidation or correction.
Silver chart pattern
The following remark was made in the previous post on the daily bar chart pattern of Silver: "Slow stochastic has entered its oversold zone, and can trigger a pullback towards the 200 day EMA."
The expected pullback crossed above the 200 day and 50 day EMAs, but faced strong resistance from the 20 day SMA (middle Bollinger Band, marked by green dotted line). Silver's price is below its three EMAs in bear territory.
Daily technical indicators are looking bearish. MACD is facing resistance from its falling signal line. RSI is below its 50% level. Slow stochastic has emerged from its oversold zone, but is showing downward momentum.
On longer term weekly chart (not shown), silver's price faced resistance from its 50 week EMA, formed a 'long legged doji' candlestick and closed well below its 200 week EMA in a long-term bear market. Weekly technical indicators are in neutral zones, and showing sideways to downward momentum. Some more correction or consolidation may follow.
S&P 500 index chart pattern
The following comments were made in last week's post on the daily bar chart pattern of S&P 500: "Some more consolidation can be expected before the index makes an attempt to cross above the resistance zone."
The index entered the resistance zone (between 2800 and 2825) On Mon. Feb 25 and touched an intra-day high of 2813, but dropped to close below 2800. Three days of consolidation with a downward bias followed, with the index touching an intra-day low of 2775 on Wed. Feb 27.
An upward bounce on Fri. Mar 1 - possibly because POTUS postponed increasing tariffs on Chinese goods - took the index to a close inside the resistance zone after 4 months, with a weekly gain of 0.4%.
Bears have managed to prevent the 'golden cross' of the 50 day EMA above the 200 day EMA for one more week by strongly defending the resistance zone.
Daily technical indicators are looking overbought. MACD has slipped below its signal line (which appears to be forming a 'rounding top' reversal pattern) near the edge of its overbought zone. RSI continues to face resistance from the edge of its overbought zone. Slow stochastic has bounced up from the edge of its overbought zone.
The index has taken more than two months to recover from three weeks of sharp correction in Dec '18. Some more consolidation is possible before the index can cross above the resistance zone.
On longer term weekly chart (not shown), the index closed above its three weekly EMAs in a long-term bull market for the fifth week in a row, but has formed a long-legged doji candlestick pattern that can halt the rally.
Weekly MACD has risen to its neutral zone. RSI is moving sideways above its 50% level. Slow stochastic is climbing inside its overbought zone, and can trigger a correction.
FTSE 100 index chart pattern
The daily bar chart pattern of FTSE 100 failed to overcome strong resistance from its 200 day EMA and corrected below its 20 day EMA. It touched the week's low of 7041 on Thu. Feb 28, but found support from its 50 day EMA.
A weak technical bounce on Fri. Mar 1 faced resistance from the 20 day EMA. The index managed to close just above 7100, with a 1% loss on a weekly closing basis.
It was the second straight lower weekly close. Strong volumes on the three down days is a clear sign of bear domination.
Daily technical indicators are looking bearish after correcting overbought conditions. MACD has formed a 'rounding top' reversal pattern and is falling below its signal line in bullish zone. RSI has dropped to seek support from its 50% level. Stochastic has emerged from its oversold zone.
Uncertainty about a possible no-deal BrExit is affecting bullish sentiments. The index may consolidate some more. (At the time of writing this post, FTSE is trading about 16 points higher.)
On longer term weekly chart (not shown), the index closed above its 20 week and 200 week EMAs in long-term bull territory, but below its 50 week EMA. Weekly technical indicators are turning bearish. MACD is rising above its signal line in bearish zone. RSI has dropped to seek support from its 50% level. Stochastic has fallen down from its overbought zone.
