Sensex consolidates between 9000 and 9500

Sensex picked up the bullish trend when the 20 day WMA crossed over the 50 day WMA from below at 9483 on 19 Dec 2008, the day when Sensex closed at 10099.91. That was the second consecutive close above the dream 10000 mark following the previous day.

For fundamental reasons (Satyam stock fiasco) the market lost a record 750 points in one single day on 7 Jan 2009, when Sensex closed at 9586.88. Thereafter sensex is hovering above 9000 mark and consolidating towards 9500, the point where strong support offered by the 50 day WMA is available.

The 20 day WMA seen pointing down to cross the 50 day WMA from above, which is a bearish note. But the prices are seen moving towards the 50 day WMA signalling a strong support prevailing at current levels. As sensex finding support at current levels, it would be wise to consolidate long positions to reap the benefit of sensex moving towards the dream 10000 mark again.

Technically speaking, with Sensex consolidating between 9000 and 9500, the earlier forecast of bullish trend for 2009 still stands valid.