07 May 2013: Nifty Elliott wave analysis: If pause sustain longer than it has higher chance of converting in to weakness anytime sooner. It has stiff resistance at 6024 levels.

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

For 07 May 2013: -

On 06 May 2013, FII bought INR 897.46 crs and DII sold INR 540.83 crs.

Money flow by FII continues and there is no great threat yet in cash market segment. Now, we have no great trigger for market for coming few days. Global markets are also not turning weak and those are stable. Indian market came near a crucial resistance of 6000 – 6024 levels.  

I believe that this market is giving signs of tiredness as it has stretched too far. It deserves a price correction but I have a technical condition. Firstly, Nifty has to break 5930 levels to conclude anything great. India VIX has given a buy and it is already rising. It was higher even for yesterday.

Threshold points are in the following ways. If Nifty breaks 5930 then it will slide towards 5860-5850 levels. On higher side it will face resistance at 6000 or at 6024. We need to note that Japanese market is on its dream run along with USA market. It seems that developed markets are moving way higher than emerging markets. I am unable to find any short term trigger to bet for significant price correction. So far it is looking like world is ‘problem free’ now. It is like saying that we got the most ideal stock market. This kind of situation is itself ‘the most misguiding’ condition.

I still believe for “May month” sell off but I am unable to get any great sign yet. To some extent, it is giving me signs for the continuation of rise. If it has to come then those technical signal must come in just 2-3 days more.  

Strategy for Nifty May future – We have importance support at 5930. If it breaks then we can feel some comfort for price correction. As long as it is staying above 5930 it keep a room to come higher. It is not looking stronger to move further but it is equally not weak yet. It is more like a wait and watch situation. It is looking tired but ‘a break below 5930’ is required to conclude.

S&P 500 – No news is bad news for S&P 500. I remember that most bullish brokerage was giving the target if 1620 for the whole year. It gave all such ‘most bullish’ target in just 4 months. So, it seems that nothing is a bad news for USA. One after another it is breaking all resistances and staying higher. There is no single technical indicator which has not given divergence. Still, it is higher. It is giving higher time for waiting for correction while dream run for bulls. 

Regards,

Praveen Kumar