12 November 2012: Nifty Elliott wave analysis: Nifty came back to the mentioned support of 5680. Keep an eye on IP data and 2 G spectrum auction. Expecting weak opening.

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

Today’s outlook: -

I have already quoted the importance of 5680 yesterday and advised you to keep you biasing to negative once it start settling below 5730. It moved in that way. I like to repeat again. If Nifty able to sustain below 5680 then we can see the fall of 40-50 points and it may try to move towards 5630. Technical resistance will emerge at 5730 levels.

I need to say that we have seen surprising and shocking out performance in the last week of trade. We have IIP data today which is expected to be just below 3%. There is another big event. Market must be waiting to see the response on 2 G spectrum auction although it can affect only the sector.  

Technical charts are also reflecting the confusion of market over direction. MACD goes in flip flop trading signal. RSI is restless but showing for weakness only. This might be the prime reason that it has again failed at higher levels. I can conclude that all these momentum indicators are on mid point crisis. Although I am giving all importance at 5680 but I need to accept one more view which is alter in nature.

If one is bullish then there is one strong logic which is going in favour of them. It seems that market is eating all weak bulls of the market. At some point, if bears get tired then it will trigger the massive rise. It is just a logic and view not the technical confirmation.

S&P 500 – I have already said that 1475 would be yearly top. Correction was forecasted after Obama’s come back. We finally came to the support of 1370. If S&P 500 has to bounce then this is the last level to talk about. It is hinting me for some recovery. One cannot stand short on US market. Although, I am not advising even long. One must note that we got one positive close on Friday.  

Conclusion for NIFTY India: - We closed near 5680 levels. Confident fall will hit only below 5680. If it sustain below 5680 then we can see the fall of 40-50 points and it may try to reach the levels of 5630. Before you get panic, I must say that there is no big threat for big fall. This market is about to digest levels to levels. Range bound activity will continue.

Regards,

Praveen Kumar