Nifty Weekly Technicals for Week Starting 10 October

This Week will be remembered as Week of downgrades

1. It started with Moody's downgrading PSU Behemoth SBI Bank after it has corrected 35% from its High and 12 UK Banks.

2. Fitch Downgrades Spain To Aa- From Aa+, Two Notch Cut, Outlook Negative

3. Fitch Downgrades Italy To A+, Outlook Negative

4. Moody’s Puts Belgium Aa1 Rating Under Downgrade Review

Rating agencies  supposedly the precursory warnings for investors. They are supposed to alert investors about the possible risks to their investment well before it reflects in the asset price. But when the whole world knows that EU countries are in Burden of Debt which is already reflecting in price  after that Rating agencies downgrading them but a question on their ethics of working.
Back in 2008, rating agencies found themselves in an embarrassing position after their best rated securities turned junk with the collapse of Lehman Brothers. The billions of dollars in losses to investors came at a time when rating agencies were still struggling to ratify their views. In 2011, the US' credit rating was downgraded when the economy's poor fundamentals were already reflecting in its currency's exchange rate.

What it all suggests is that the rating agencies have done too little of their job, too late.

Nifty Hourly Chart

Its all Gaps which are ruling the Nifty Hourly charts. On Friday Nifty faced resistance at 4922

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