16 May 2013: Nifty Elliott wave analysis: Fresh hope of rate cut gave a fresh out. It is looking for more and more upside if it manages to stay above 6160 levels. Technical support is at 6110-6100 now.

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

For 16 May 2013: -

On 15 May 2013, FII bought INR 1646.95 crs and DII sold INR 747.11 crs.

Now a day lots of unexpected things are happening in global financial market. From the day easy money hit, it becomes master indicator. New in the series came from India where RBI governor gave a ray of hopes for the next monetary policy review. Hence, we got a surprise rally.

A surprise rally gave us a fresh breakout on long term chart as it has successfully crossed the previous high of 6111-6115. It is almost 700 points stretch on Nifty from its recent of 5477 and it is still running. It can be concluded that it is over stretched but the fact it that it got new fuel to run higher.

There are few contradictions in India market. Like, VIX also got the breakout as it is now at 18.13. Does this give a hint that people are buying this rally with fear? Answer may be yes but on charting basis it is a breakout on higher side to see a move towards new all-time high. We just need a follow up rally. So, today’s trading session will be very crucial.

Technical charts are suggesting that crossover of 6160 will give another higher levels towards 6240 and then may be even 6360. Well, it is very important to note that the lower side support will be at 6110-6100 levels. If it breaks 6100 today by any chance then we need to review again. It is not an easy market to trade.

Strategy for Nifty May future – Yesterday’s high of 6169 will act as crucial threshold point for today’s session. Cross above 6169 (for 5 minutes) will drive it higher towards 6250-6260 levels. Strong technical support will be at 6110-6100 levels. Condition for this rise to continue is that it has to maintain levels above 6100. Let us see how it is going to shape up for the day. I still say that nothing is unexpected for Indian market.

S&P 500 – If I take November low which was at 1345 then we have already seen a rally of more than 23%. Now, this is historical. It has never gained so much in one rally. It is full 11.20% away from its 200 days moving average. Every day it is making newer life time high. It has crossed its previous life time high on 10^th April 2013 and it is still continuing. No one knows when it will fall but whenever it fall it will be brutal one. I am still on wait and watch mode.

Regards,

Praveen Kumar