SENSEX HEAD & SHOULDER ???
-->Finally the much awaited "GOLDEN CROSS" happened. According to Technical Analysis Theory "History Repeats Itself" we may have entered in the BULL MARKET. Last time when “GOLDEN CROSS” happened on Sensex, it was at 5963 and rised up to 21206 which was almost 256% gains from 5963 and Sensex took 49 months to reach 21206 mark.
-->In Current scenario when GOLDEN CROSS happened 22/06-2009 Sensex was at 14000 and if we calculate the same % gains on it the it comes to 49000-50000 on and Sensex may reach this mark in 49-50 months of period starting from 22/06/2009. So by July 2013 we may see 49000-50000 on Sensex.
"HEAD & SHOULDER PATTERN"
-->Currently Sensex and Nifty both are forming Head & Shoulder pattern on Daily chart, which is bearish pattern technically. Left Shoulder and Head are being formed and now Sensex and Nifty both are in process of forming of Right Shoulder. Technically we need to wait for the pattern gets completed and If the pattern gets completed and Both the Indices Break and closes below the neckline that will be our confirmation and then the target comes for Sensex is around 12000-12200 & for Nifty it comes to 3600-3650.
-->Now we need to wait for confirmation and wait for the whole pattern to develop. If Sensex and Nifty manages to take out previous highs of 15600 & 4693 then our view on H&S will be negated. We need to wait and watch for momentum line also, if it gets broken then the uptrend will come to an end in intermediate, the value comes to around 14300. We had mentioned about one big correction can not be ruled out (about 1500-2000 points on Sensex) in our view dated 14th June 2009 which we will treat it as "GOLDEN OPPORTUNITY".
-->There are two type of trading strategy in this kind of pattern
1. Sell 50% at 14900-15000 and sell remaining if Sensex breaks 14000 mark.
2. Exit from all longs whenever Sensex breaks and close below 14000 mark.
-->Weekly Support comes for Sensex to 14300/14000/13700 while resistance comes to 14900/15600/16200.
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