05 November 2012: Nifty Elliott wave analysis: Closed above 5690 but it is still forming enough doubt. Fall can resume any moment now. It will definitely break 5630 again.

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

Today’s outlook: -

I have already said on Friday that it may come near to 5690 but it has closed above that. One can sense that it is a sign of strength. Well, I was already saying that H&S pattern can cause a retest of neck line. It cannot be taken as any great sign of strength. It is a usual pullback and it will be effective as long as the level of 5730 is failing.

We are on another crucial week in term of events. We have US president election this week. Wave trend is suggesting that we may see either silence or negative biasing on stock price. I am giving importance to the technical resistance of 5730. We may not see the cross easily very soon. Suppose, if we cross 5730 then I may consider something for strength.

For intraday we will have a threshold point at 5680. If trades sustain below 5680 then it need to test the range of 5650 to 5630 levels. I have already updated in past also that break below 5630 can initiate a move towards 5580 levels. I want to be unidirectional on my trades.

I have seen some concerning charts too. One such is Reliance. It is struggling and may give fewer percentages by this week of trades. Things are turning odd for this company. I am also sensing that telecom sector will prove as laggard in rise and leader in fall. My choice from current levels is moving for shorting the weaker stocks. Technology and auto stocks are not weak but those are on resistance.

We need to focus on metal stocks too for trading. I can say that those may turn too a concerning note anytime. I am talking in term in some technical parameter which are suggesting that past three days of rise a just a pullback before fall.

I am updating all my studies with a comparison from S&P 500 too. It has technical resistance at 1435 to 1438 zone and we have seen fall exactly from those levels only. My charts are preparing for the visit of 1400 levels. In worse case we may see the levels of 1380 levels too. Global market might be nervous before US president election. I am sensing that Mr. Barak Obama will win this election (I am talking about probability). If this happens then stock market may react with fall. Well, most than politics, I am sensing for fall in global indices.

Regards,

Praveen Kumar

05 November to 09 November 2012: Wave Analysis: A break below 5630 and then a rebound. Take a note that nothing is changing. It was an expected rebound.

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

This week outlook: -

I was expecting a break below 5630 for last week and we got it. Then, we have seen a rebound from lower levels of 5583. In my daily wave analysis, I have quoted for 5580 as support. I have quoted also that after breaching neck line of 5630, it will try to regain higher for once. It came in line with expectation but little higher in magnitude. That throws Nifty near 5700 marks.

Firstly we need to understand that Friday’s booster came from global market recovery. Unfortunately global rally seems to be dying on Friday night itself. It happened perhaps to satisfy the charts.

Beginning from 4770, we have almost finished fifth wave. Now current fall can give us the beginning of wave ‘A’ which must be corrective in nature. So, is it happening?

That’s the question.

Weekly charts are giving some signs of silence in pause. Here is concern that we may have negative biasing. This negative biasing can turn to a “panic mode”. We are heading to a very crucial week.

1. We have US president election. If Mr. Barak Obama wins then we may see selling in global market. Will it happen? In my views, perhaps “YES”.
2. Greece, (truly sick and tired’ of talking about this one), it is again looking troubling mode. I will wait for Wednesday’s decision.

There is another very important technical point. We have seen higher weekly close last week but this gain was not justified by India VIX. It is fluctuating in the range of 12.80 to 15.80. It is really going to interesting now. Based on this, yes, I can press a panic button too.

We have closed at 5695 levels. We need to see a dip and a support at 5630 levels. You must note that we have H&S pattern. Traditionally, it has rebounded to cross n-line. Well, I can say that we need a fresh break below 5630. As long as we are saying below 5730, there is no need to think about anything for rise.

I hope that we will see selling intensifying after US president levels.  

Regards,

Praveen Kumar