Analysis of secondary indicators

As we have previously noted, we have the following view on the markets:

1. US DJI - bearish. The view will change only if we cross 13710.
2. India Sensex- topping. We said our target will be 14950-15100. The Sensex hit 15007 before closing around 14965.

Having said that, we feel this week will make the direction clear. Use oppotunities in the start of the week to unload all holdings. As we approach the middle of the week, we can build some short positions in the Indian market. In the US markets, we already have short positions.

Let's look at some of the secondary indicators:
Nasdaq Bullish %:
Though the Nasdaq has been making new highs, the BP index has failed to make new highs. This negative divergence has helped in timing previous corrections and goes in line with our bearish view. The chart provides more information.



DOW Bullish %:
The chart is self explanatory. The negative divergence bolsters our bearish view.