NIFTY: 21 May 2012: Already quoted for support @ 4790 and advised you not to short. Expect pause for 1-2 days more before fall. Nifty resistance @ 4930 < 4950. Support @ 4850-4837
You must read previous articles and watch above chart carefully to understand this article completely.
What was quoted yesterday?
I have already quoted few supports for Friday’s panic gap down. It has hit a low at 4788.95 and rebounded. It was just the support of 4790 to act. Do not count for few seconds’ trades below 4790. I would still like to focus on same technical support again and you should keep those in your mind.
Ratio analysis is suggesting few important levels.
- 4790 = 76.40% from 5630 against the rise from 4531 to 5630. We must be opening near to this one.
- 4766 = we have seen a vertical dip from 5125 to 4903 few days back. 61.80% further dip from 4903 will end up at 4766
- 4740 = which is the reaction of actionary wave from 5136 to 5379. Take 1.618 times from 5136 or 2.618 times from 5379. It will give us 4740.
Now for today, main question is about the magnitude of recovery.
I am expecting this recovery to continue but (strong but) we will have to see a dip from higher levels. We can expect this recovery to come near to 4930 < 4950.
We need a decisive cross above 4950 to bet for some revival on time frame. Trading resistance will be at 4930.
One must focus on follow up buying on the next day of recovery. Somehow I can sense selling from higher levels as long as we fail to close above 4950.
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Praveen Kumar
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