We have seen the break of crucial 5171. World was expecting bloodbath below 5171 but it did not happen. Nifty has broken 5171 tested low at 5135.90 and took a pause to close at 5178.
I have already mentioned about the support of 5135 to all paid subscriber before market opens.
There are three wave formations of A-B-C. First was downside A-B-C then corrective A-B-C (up).
Amplitude of first corrective wave was 5630 to 5268 = 362points.
There were fair chances for next corrective first down wave to be comparable of wave A itself.
Hence if we take from top of 5499 then 5499-362 = 5137.
It worked well as of now. Hence we have not seen those talked fall below 5171. Its too early to say how long can 5135 sustain.
The way 10 year bond yield is moving, it is making stock price unstable. As long 5135 sustain we can hope for rebound towards 5300 levels.
I am strongly warning that current upcoming recovery on index may not sustain for long. It may try to test Nifty levels of 4900 levels.
Government borrowing is a concern. Issue over GAAR may cause hurt in sentiment.
200 DMA - 5150- FREQUENT TEST IS GIVING A HINT THAT IT HAS TO BREAK AND TEST LEVELS MUCH BELOW THOSE. Do take a note that NIFTY is down by 6% in March in spite of $3 billion inflow by FII.
STRATEGY
*Short trades are possible only below 5135 of NIFTY spot.
* As of now NIFTY is a buy with stop loss at 5135 for a move towards 5252-5300 levels.
* NIFTY APRIL FUTURE can try to test levels near 5300 today.
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