15 May 2013: Nifty Elliott wave analysis: Trending support for Nifty is at 5980-5970. Only break below those will give next bigger sell off. Resistance should emerge at 6040 and 6070.

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

For 15 May 2013: -

On 14 May 2013, FII bought INR 420.99 crs and DII sold INR 412.66 crs.

Nifty has saved technical support of 5970 as a dot. It has not closed on encouraged note. Well, what has happened last night was more remarkable. USA and Europe market has seen further massive rise. Backed by those, Japanese market is above 15000 marks right now and this is first time after January 2008.

When will this euphoria stop in USA? Well, no one can say that and it is looking like those will never fall now. It is useless to focus on any reasons. As long as fed is backing equity price, it is looking hard to expect fall. Even investors satisfaction looks like to convert in to greed.

For Nifty, it is very important that it sustain below 5970 now. If it starts trading below 5970 then we can expect selling to extend toward 5930 to 5900 levels. In alter sense, as long as it is saving 5970, we can expect pause. I do not think that rise in US market is sufficient to give us a push. Indian market is under - performing on long term chart.

On higher side, it will have two important trading hurdles, which is at 6040 and 6070 levels.

Almost all momentum indicators are giving a sell signal. It is still hard to believe how much we shall believe the technical indicators when global markets are on massive rally. So far SGX Nifty is at 6034 levels which are not as strong as global market.

After CPI and WPI numbers, market is looking for GDP data.

Strategy for Nifty May future – It has last close at 6005 but it may see some higher opening near 6030 levels. After higher gap, we should first see the gap fill if it comes. Yesterday, we have seen massive volatility in 40 points range. I do not think that it will be easy to deal for intraday cue to volatility. Avoid trades for first half, and then act based on high-low of the first half. By any chance, if it breaks 5980 on lower side then a definite short trade will emerge.

S&P 500 – Does it make sense? Definitely not, at least based on any book of technical. Remember that 1600 to 1610, it has not trades at all as it was gap up. Even that gap it has failed to fill. I got a threshold at 1616 to 1620 but it has saved those marks too. I just like to see when it will give up. Closing at day’s high can never give any such signal for even small pullback. This market looks too far away from investor’s satisfaction.

Regards,

Praveen Kumar