DOWJONES DAILY CHART
SENSEX DAILY CHART
Today instead of pasting the regular price volume charts, I am using Moving average charts to determine the strength of the present downtrend. The green lines are long term moving averages which symbolizes long term trend of the market, While the rend lines are short term moving averages which signifies short term trend of the market. We can observe that Sensex there is a broad based selling represented by green lines while a narrow buying by traders is also emerging. But unless the short run moving averages represented by red lines crosses over the long term moving averages represented by green lines. A long term up move is unlikely.
SENSEX DAILY CHART
Today instead of pasting the regular price volume charts, I am using Moving average charts to determine the strength of the present downtrend. The green lines are long term moving averages which symbolizes long term trend of the market, While the rend lines are short term moving averages which signifies short term trend of the market. We can observe that Sensex there is a broad based selling represented by green lines while a narrow buying by traders is also emerging. But unless the short run moving averages represented by red lines crosses over the long term moving averages represented by green lines. A long term up move is unlikely.
Now if we observe Dowjone's chart short term averages are just moving above long term averages. This may prove to be a inflection point form where the market may resume the uptrend but still the cross over is very weak at this juncture and the probability of it proving to be a false breakout is very high (marked by a yellow arrow on charts). A strong breakout will be a definite sign of an uptrend.
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