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Tuesday, July 12, 2011

NCDEX Turmeric July CMP—Rs 7718.00

Technical Outlook & Trading Strategy:-

The price of turmeric appears to be taking shape of an inverted head & shoulders pattern with a rising neckline on its intraday charts.This is an extremely bullish price pattern and this will have a positive effect on the price of turmeric over the near term to short term.

The measuring implication of the pattern once the price registers a breakout above the neckline resistance level of Rs 7740 levels suggests that the price can advance to levels of Rs 7850 and/or Rs 7975 levels.The RSI indicator has also given a buy signal backed by a positive divergence.

We recommend traders to buy 50% at current levels and add to long positions as an when the price breaks above the neckline resistance of Rs 7740 levels for the above mentioned implied target levels. A stop loss of Rs 7583 levels should be maintained on all long positions.

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