NIFTY: 01 June 2012: A gap down expected but support remains @ 4877 (No short as long it hold this level). If it breaks then expect 4843.

You must read previous articles and watch above chart carefully to understand this article completely.

Fall that begun from second half of 29 May has seen a low at 4884 yesterday and closed near 4925 on expiry day. I have already mentioned yesterday that as long as 4877 saves one should not prefer to trade short. (GDP data is surely become the most concerning factors and will make impact but it was not the perfect day yesterday).

I follow technical charts and that is still suggesting me that I should retain my view. As long as 4877 hold we should not prefer to short near and before that.

If it breaks 4877 then you can expect a dip towards 4843 then 4789 also. Even after looking on SGX NIFTY right now, which is down by 40 points, I will not prefer to short immediately.

I am repeating my yesterday’s given levels once again.

Take a recovery wave i.e. a-b-c. From 4789 to 5020 (Note that we have successfully forecasted those on time or before time). Taking retrenchment few important levels are as follow-

• 4932 – Very obviously, it will not be visible in opening minutes.
• 4904 – Gap down will give you opening near to those. (Consider 3-4 points of approximation)
• 4877 – It will be the result on the failure of 4904 on decisive break.
• 4843 – If panic hit the market then you can expect fall up to 4843. Do not forget that we are on expiry day so nothing is impossible.

I have already said for the correction to continue for 3 days or maximum of 5 days. We have completed 3 days. Recovery should begin now. When I am talking about recovery then I am hoping for a positive close. Let us see.

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Thanks & Regards,

Praveen Kumar

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