15 April 2013: Nifty Elliott wave analysis: Somehow and someway, Nifty will find its way to sail towards 5447 to 5400 levels. Indian market opened its earning season with massive disappointment.

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

For 15 April 2013: -

On 12 April 2013, FII sold INR 28.59 crs and DII sold INR 311.92 crs.

It is looking like FII are losing their hopes on Indian market. Till now, there is no big exit yet from cash market but money flow can turn alarming now. It was expected due to under performance. Now when earnings are also justifying the fall, situation can be really bad.

We need to note that it was technology stocks which had a better performance in past 3 months. Now, after Infosys result, it’s the time to think again. Banking index has limited the bigger damage on blue-chip index. In my view IPP and CPI data were also not so bad. When I am saying ‘not so bad’ then I refers to the possibility of rate cut in up-coming monetary policy review. I feel that we will get another rate cut in the early next month. That is still too far as it will come after 12 trading sessions.

My concern is that we have to see the worse possible earning season before any good news. Market will react on WPI number too. Reliance will present its quarterly numbers tomorrow. There is nothing good or optimistic to discuss except US market.

I have no reason to make any change in technical views. My technical charts are suggesting me for resistance at 5610. I have already said for the support in the zone of 5540 to 5530 and it ended below 5530. I am sensing that sooner or later, Nifty will hit 5447 levels first. On 13-14 September 2012 we had a gap up from 5447 to 5527. Market should prefer to fill up that gap up.

Prefer to see new wave of political heat in India.

Strategy for Nifty April future – I am expecting a soft opening for today. Then keep an eye on dot 5500 levels. Suppose, if it start trading below 5500 then we can see rapid fall towards 5480 to 5450 levels. On higher side it will face resistance at 5560 levels. It will be another complex trading day ahead. One must note that now market is giving impulsive moves on both ways. If fall comes then follow up comes with fall or vice versa. I will not prefer to touch this market unnecessarily. I am strongly saying; be aware of put call ratio.

S&P 500 – Day after day, it has passed almost 4 months. There is no any remarkable price correction. Now even at new all time, reactions are not coming the way I was expecting. 74 S&P 500 companies will declare its earning this week. The way it has recovered on Friday, I need to conclude that it will take a green Monday and an ugly week. Now, I will not say, “When will it correct?” Now I need to say, “Will it ever correct?” It is not only the historical levels but also the historically bullish sentiment. Rather than predicting for levels (which is next to impossible now, last one is 1600) I will go with a view for correction/profit taking /fall.        

Regards,

Praveen Kumar