Will the spike last Friday bring index to 6100 level?

While our index followed an upward channel where our base is at 5709.34, it broke down last Tuesday when it fell by 2.1% and showed a neutral bearish signal via the Kijun Sen Cross. The movement after the fall could be considered a recovery but will it be able to cross the Kijun Sen? Take note that this line will now be our immediate resistance. Furthermore, it seems that index is developing a downward channel and the move upward last Friday could be the lower high. If this will be the path that the index will take then we might see it fall and find support at 5842.88

In case index will continue to rise, we might see it hit the 23.6% Fibonacci Retracement level or around 6109.37 – 6112.39 The 6109.37 is based on the weekly chart where we can see the Kijun Sen moving horizontally at that level and the 6112.39 is based on the possible spike since the index has retraced by around 78.6% Fibonacci Retracement level.

What we should do is check the candlestick on Monday. If it shows a bearish reversal pattern then price will move down to its support while absence of that will bring our price to the next resistance level.

Caveat!

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felix

A computer engineer by profession and loves to develop online systems/websites. A self-taught stock trader who loves to share his knowledge and enjoys learning, expanding knowledge and staying well-informed. Most often he uses candlesticks, Fibonacci Retracement levels, Ichimoku system on his technical analysis but loves to hear some rumors as well.

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