You must read previous articles and
watch above chart carefully to understand this article completely.
Today’s outlook: -
It has seen a dip from 5368
yesterday and now it may turn decisive now. We have reverse H&S pattern on
daily chart. I was calculating the advance of wave as 1-2-3-4-5 but it seems
that it may convert to a-b-c only. As of now it is three wave advances. From this
point we have two possibilities: -
First is, we may correct up to 5278
and then a rise to get the target of reverse H&S at 5526.
Secondly, if we break and sustain
below 5278 then things might be concerning. You can say, highly concerning.
Whatever has to happen but right now
it is looking for a dip towards 5278. In a weak macro economy factors, we have
already seen massive rise. I like to see SBIN result today to decide main up
coming trend. What is happening on oil market PSUs are also concerning. IOC
presented mammoth loss figures, historical figures. Yesterday, FII bought 337
crs and DII sold 754 crs, this is showing negative views by domestic player.
Wave development: -
Nifty has a low at 5032 on 27th
July 2012 .
As of now we can sense that there is a beginning of new wave which probably is
going to be a rising wave. Take a note that we have seen a completion of up
wave which has started from 4770. It is named as 1-2-3-4-5-a-b-c in above
chart. On 3rd August 2012 , we got a low of 5164.65 which is
exactly 38.20% against the rise from 5032 to 5246.
This is encouraging with few
challenges on higher side. Every wave trend has some relation with its previous
wave or waves in terms of ratio. I myself have said that this is going to be
most unreliable rise looking the reason of rise but when I have to work with
charts then I am forced to keep those away. I can tell you that charts are
still saying that I am not wrong in a big way. Magnitude of upcoming wave will
be lesser compared to past few waves.
Charts are saying that if we manage
to close above 5279 then we can conclude for the formation of ‘reverse head and
shoulder’ pattern. It will have n line @ 5279. You can say for the rise which
should be equal to 5279 – 5232 = 247 points. It can give me a target of 5526.
Well, it is looking easy but it will not be easy. We can say,
Beginning point of wave = 5032.40
Wave 1 = 5246.35
Wave 2 = 0.318 times of wave 1 = 0.318 times
of (5246.35-5032.40) = 5164.65
Those who are bullish in their
nature should keep their fingers cross for 5279+.
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