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watch given chart carefully to understand this article completely.
Today’s outlook: -
I was talking about a pullback for
whole this week. It came yesterday to it a low at 5838 but then something
happened to bring such a sharp recovery. BSP chief Mayawati said that her party
will vote in favour of FDI in Rajya Sabha. If majority of Indian citizen hates
politician then there are some reasons. Mayawati got overnight enlightenment
and took “U” turn which gave “V” shape recovery. I am not at all encouraged by
the way government is moving with reforms. These will be treated as half –
hearted reforms and we may not see great desired result. I am talking about data
point not the stock price.
To be honest, I was unable to see
this kind of steps coming from BSP. Let us see how market is going to react
today. Voting will take place at 2:30 pm today. We have already seen sharp
short covering yesterday. Wave theory and technical is surely going in favour
of bulls. Waves are going to extend more but I am not very sure about any big
extension. One must note that rise has length of 390 points till now.
FII has bought in cash market and
selling in derivative market. This is something which can increase the
volatility in coming days. I will prefer to avoid market again at higher
levels. There are few technical levels which market tries to achieve on higher
side. We have technical resistances at 5950 < 5967 < then 6000. Which one
to act? Only time can answer. We must remember that today is Friday and we have
already seen a massive short covering yesterday. It is looking like we have
already reacted on FDI in retail issue.
Technical indicator RSI was giving a
sell yesterday when we were falling but eventually avoided that sell signal due
to sharp pullback. It is standing above 70+ Zone. If it goes below 5890 then
only it will be looking to make exit from overbought zone.
I strongly feel that no matter what
is happening in political front but Nifty may not able to cross 6000 marks
directly in one wave from 5548. If this happens then logical target will be new
all time high in just few weeks.
Conclusion Nifty: My expected pullback came
yesterday but things changes suddenly in post 2 pm trade as BSP Mayawati changes her
stand on FDI in retail. We may see flat opening but rise is going to be very
limited through out the day. One can make intraday deal for long side in dip to
get 15-20 points.
S&P 500 – At the beginning of the week it
was forecasted that S&P 500 will remains in the range and will not above to
move much beyond 1405 to 1424. Till now it is not doing anything great and
spend whole week in the same ranges. It is still looking for dull trades. Consolidation
is the natural law of market. It can take place in two ways, either by
accumulation (result will be rise) or by distribution (result will be fall). It
has thin line difference and I am unable to conclude for up coming direction. It
is looking like for a rise but I am not confident.
Regards,
Praveen Kumar
