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The NSE Index has broken below a support at 10,526.87, the 23.6 per cent Fibonacci projection level of the downtrend from August 28 high to October 26 low.
Monday's decline suggests that the correction that started on August 28 (wave(4)) has not yet completed. The index is in it's final wave. The current wave is expected to have five sub-waves and the intraday chart suggests that it is the third sub-wave.
In the near term, the index has support at 10,283.23, the 38.2 per cent Fibonacci retracement level of the uptrend from December 26, 2016 low to August 28 high. The index again formed a death cross (a bearish sign) as its 50-day exponential moving average (EMA) once again fell below its 200-day EMA.
The 50-day EMA fell below the 200-day EMA earlier last month, though it managed to pull above the 200-day EMA earlier this month. The NSE index is up 1.55 per cent this year as of last close, while MSCI's Asia Pacific ex Japan local currency index is down 11.74 per cent in the same period.
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