05 June 2013: Nifty Elliott wave analysis: Nifty has closed below 5930, it may extend fall towards 5860. It is almost confirmed that H&S based fall is coming.

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

For 05 June 2013: -

On 04 June 2013, FII bought INR 84.79 crs and DII sold INR 216.45 crs.

It is clearly visible that FIIs are staying away from buying. If you look at past few years of money flow then you can observe that this is the first time that FIIs are not buying the range of 5900-6000 levels. I have repeated many times that FIIs may not remain bullish on underperforming market.

I have already said for a bounce for relief. It came and turn dead exactly at 5980 resistance levels. It is very crucial that Nifty has closed below 5930 levels. Now next levels to watch for support will be at 5860 levels. Technical charts are suggesting for support to emerge between 5930 to 5900 levels. On daily chart, it is a development of H&S pattern with n-line at 5930-5900 levels. The length of n-line to head is almost 300 points i.e. from 6230 to 5930. Rough idea suggest that break of this n-line will lead Nifty towards 5930 – 300 which equals to 5630 levels. Is it coming? I will look for technical confirmation below 5860.

We need to remember those global stock market rallies were backed strongly by monetary easing. Now, world is feeling that monetary easing may be in last phase.

Strategy for Nifty June future – I have said for support at 5925 and somehow it is looking for opening below those levels. SGX Nifty is down by 25 points at 5910. Failure above 6000 marks is concerning. It is looking like to hit 5860 levels. On higher side 5970 and 6000 will act as stiff resistance. H&S pattern may make this market scarier in coming days.

S&P 500 – I have said for a bounce to extend which was coming after hitting 1622. We got intraday high at 1646 and then a fall. Technical charts are suggesting that we should prepare for the test of 1600 marks by this week only. If things go worse then we can expect 1575 too in coming week. I am already saying that US market is now getting follow up of selling. There are fear about bond buying program.

I repeat that that 80% chances are that S&P 500 has made a top for the year 2013

Regards,

Praveen Kumar