Present Prices are so attractive - DO NOT IGNORE

Relative Strength Index in September of 2008 was heavily oversold at around 6.9 points and the ASI was around 2100 points. Thereafter the RSI was rising although the ASI kept on falling making it a positive divergence. This was an indication that the selling momentum in the market was receding, although the sentiment of the market was negative. Ultimately the Market re-wrote the history by propelling it to new record highs. Ever since then the RSI never fell below 15 points till 2015 when it happened once, as it came down to around 14 points. But in 2016 the RSI fell below 12 points on 2 occasions, indicating the pessimism amongst the Sellers, stemming from factors in and out of the Country. An oversold market is bad for the Sellers but never for the Buyers. Since the lows in the RSI we now can see that the level of Selling pressure is not as great, but it did check the levels below 20 points on the RSI. One good indication for me is that the trend of the RSI is in the same direction as the ASI. Thus we do not see any negative or positive divergence just yet. The biggest draw back is the pessimism and fear psychosis prevalent in and out of the Country. Unfortunately the actions that are taking place inside the Country are rather unfortunate for the direction of the market and is confusing all the stakeholders of the Country. But this negative scenario in the Market is benefiting the Long Term Investors and a few individuals, which is the Minority just like a Minority in the Society of the Country is reaping benefits due to the present state of affairs. 

Present indication is encouraging as the oversold effect is not as big as what we saw a few months ago.

 

1000 day Moving Average

One of my personal indicators for the CSE is the 1000 day moving average. As you know the 1000 sma is the average value taken by dividing the closing values for the last 1000 days. WE ARE TRADING IN AND AROUND THIS LEVEL. I see this as a major game changer for the market when it pierce through up or down. As can be seen in the following chart the ASI did break down through the 1000sma on the 27th of June 2016, but broke out convincingly yesterday the 8th of July 2016. That for me is a bullish signal. ASI tried to break down the 1000sma at 6262 on 20.01.2016,but got supported and the ASI moved up about 200 points. Again the ASI came down and pierced through 1000sma at 6264 points on the 15.02.2016. This time it could not hold, and nose dived to 5862 points. Drop of 402 points from the 1000sma. On the 12th of April the it broke out of the 1000sma at 6280 points and went upto 6708 points till the 16th of May 2016. On 27.06.2016 the ASI broke down at 6335 points, BUT dropped only to 6254 points. That was 81 points only. Which means that the latest recovery was not bigger than the previous. Now that is another bullish signal to me.

I know you may not have time to read further. But I value your interest in reading it up to this far.
There are many more indicators that are suggesting that the MARKET is going to go NORTHWARDS. I will cover them in the next few days. PLEASE DO NOT IGNORE THE MARKET. IT IS CALLING OUT LOUD FOR YOU TO INVEST AS THE PRESENT PRICES ARE GIVING YOU MANY BARGAINS.