31 July 2013: Nifty Elliott wave analysis: No great sign of revival is coming. Nifty may extend fall towards 5680 levels if it sustain below 5730 levels. Even 5800 will act as resistance from now onwards.

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

For 31 July 2013: -

On 30 July 2013, FII Bought INR 256.45 crs and DII Sold INR 415.00 crs

Government of India and RBI wants to handle the weakness of Indian rupee but they failed on that front too. Indian Rupee was touching 60.70 yesterday. Expect another panic flow today also. All those useless steps to handle rupee has given a jolt to stock price. I do not remember when economy was under this kind of panic last time.

One need to note that half of trading volume on Indian rupee is coming from overseas market where regulators cannot act. What they are betting? They are betting for India rupee to hit 65 against US dollar within a month. This seems to be worse than 1997 Asian financial crisis.

India will eagerly towards US market and hope that QE should more. Technical chart has turned to a fearful note and never looks like this before. Charts are suggesting that break below 5730 will give fall towards 5680 levels. Remember, it came at monthly low with just five days of fall. Now, even 5800 may act as stiff resistance.

Logically, recovery should come but there is no visible sign yet. Visit again to read my intraday updates as I can update about those only during market hours.

Strategy for Nifty July future – SGX AUGUST NIFTY is down by 20 points. It may open near 5780 levels. Any further trade may give us levels of 5740-5730 marks. It may see panic which will come from currency market. Will it recover now? May be it can but we need to see some technical formation to bet on those. So far, it is so bad. On higher side, it will face resistance at 5820 to 5850.  

S&P 500 – I can still say that US market is on dull note but not on the weak note. This pause near high is a signal as bulls set up. This market is not like India. Technical charts are still saying that it will break 1700 on higher side as it is still reviving above 1675 levels. All eyes are on fed minutes now. Expect further 2% rise on the cross of 1700 levels.

Regards,

Praveen Kumar

30 July 2013: Nifty Elliott wave analysis: Today is decisive day. Whatever RBI wants to do, they will do it. Technical support is at 5800 to 5770. I am still expecting positive for market.

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

For 30 July 2013: -

On 29 July 2013, FII Sold INR 231.77 crs and DII Sold INR 101.26 crs

I will address yesterday’s fall as a nervous sell off before RBI meeting. Bank Nifty slipped over 11% in July month so far and a nonstop falloff almost 23% from its recent short term top. These are the levels which can make panic to even long term investors.

Nifty has almost retraced 50% of its recent rise. An exact level is 5830 which should be acting as strong technical support. Well, it was trying to break 5830 marks in last minutes of trading yesterday. This is a concerning pattern. I still believe that it should bounce now.

I can still say that we are in the zone of strong moving average supports. All eyes are on RBI policy right now. Honestly, RBI should opt for rate cut if they are concerned even a little about growth. Yesterday’s economic survey report is suggesting me that there should not be any possibility of hike. Well, but no one can claim anything about RBI governor.

Whatever RBI has done to save rupee was also not impressive in term of outcome. Bank rates need to stable to down to save economic from a big disaster. Let us see. Worse case out – hike in CRR.

Upcoming two days are important for US market too as we have fed meeting on 30 July and 31 July 2013.

Strategy for Nifty July future – SGX AUGUST NIFTY is up by 20 points. All eyes will be on RBI after opening. As long as it is saving 5860 levels you can expect bounce towards 5930 levels. Break below 5860 will give panic selling towards 5820-5800 levels. I am expecting positive outcome from RBI policy.

S&P 500 – It has to break 1700 on higher side by this week only. It can happen anytime now irrespective of fed meeting today and tomorrow. Technical charts are suggesting for strong trading support at 1675 levels. On higher side it will break 1700 levels to trap all short deals. Cross over of 1700 may generate the target of 1740 to 1750 levels.

Regards,

Praveen Kumar

29 July 2013: Nifty Elliott wave analysis: It is not good to see close below 5980 before RBI policy. Moving average support is in the zone of 5860-5850. To get strength, we need to see Nifty above 5930.

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

For 29 July 2013: -

On 26 July 2013, FII Bought INR 278.04 crs and DII Sold INR 489.17 crs

Market is likely to be very nervous before RBI monetary policy. Nifty lost 0.40% on Friday (still positive for month by 0.80%) but bank Nifty lost 1.40% (negative by 10% for July month). It seems that banking stocks are going under re-rating. This is adjusting with their higher NPA.

Now, all eyes are on upcoming RBI monetary policy which is scheduled to come tomorrow. I can say that expectations are clearly divided. Some expects unchanged policy, some expects rate cut and some expects even rate hike. It is beyond the limit to guess about RBI governor’s mind.

No Asian market is looking better than EU or US indices. Even Japan is also on slipping mode. Technical charts are giving multiple trading supports on down side. 200 DMA is at 5852, 100 DMA is at 5862 and 50 DMA is at 5898 levels. Hence I am expecting good trading support in those ranges where we are already trading.

It is equally important to note that we are not getting some critical negative divergence which is first sign of caution ahead. To achieve any kind of strength, Nifty needs to stand above 5930 at least.  Extreme side of weakness can push it towards 5830-5800 levels too.

Upcoming two days are important for US market too as we have fed meeting on 30 July and 31 July 2013.

Strategy for Nifty July future – SGX AUGUST NIFTY is up by 10 points. It is likely to open flat. As long as it is above 5900, it can try to save. Suppose, if it breaks 5900 levels then we can expect 5870-5850 levels on downside which may be quicker fall. I am expecting range bound trade.

S&P 500 – We saw another example of strength in US market. S&P 500 open lower and hit 1675 before rebounding. Finally it closed in green. Now, 1700 is practically a level to deal. It is very obvious that it might be invited many bears to short near 1688-1675 zone. I feel that crossover of 1700 will force everyone to cover their short. Daily chart has negative divergence on MACD so rise may be limited. So far, keep an eye on 1700 levels.

Regards,

Praveen Kumar

26 July 2013: Nifty Elliott wave analysis: Likely pullback should be over and Nifty got the support at 5892 levels. First logical target and resistance is at 5970.

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

For 26 July 2013: -

On 25 July 2013, FII Sold INR 442.94 crs and DII Sold INR 138.80 crs

FII has sold heavily in the June month. They were relatively muted for July month series. It is interesting to see if fresh money will flow now or not. We got May month correction but I never give importance to money flow since then.

Bank Nifty slipped by 8.60% so far in July month. Major part of the pain has done for now. Recent steps taken by RBI has caused last 4-5% fall. Apart from that, many banking stocks has given poor set of quarterly numbers which was expected.

Nifty has 38.20% retrenchment coming at 5892 (against the rise from 5566 to 6093). I am assuming that pullback has almost done now. Take a note that rising trend sustain as long as it respect 38% retrenchment. On higher side it is important to see it sustaining above 5970 levels first which is first logical resistance. I am expecting a small gap up today. India VIX is still suggesting that we are in rising trend.

In any case if it breaks 5890 then one can expect levels of 5830 to 5800. It should not happen. Market is waiting for the outcome of upcoming monetary policy review. Market has fear of rate hike. I hope that this fear will not be a reality.

Keep an eye on HUL,PNB and BoI result which will come today.

Strategy for Nifty July future – SGX AUGUST NIFTY is up by 20 points. It has trading with heavy premium of 40 points. It may not remain same. On higher side it needs to sustain above 6000 marks to use the word stable.  It is likely to open near 5970. Let us see if it can cross 6000 or not? If it crosses 6000 then expect good rise by today itself.

S&P 500 – We have 80% chance that pullback is over with a bottom at 1680. It is very likely to give a strong cross above 1700 marks. It may happen today also. The length of this upcoming rise can be impressive again. First logical target above 1700 should be near 1730 levels. It is a fact that US market is the strongest market of the world. It is saving many part of the world from fall like India.

Regards,

Praveen Kumar

25 July 2013: Nifty Elliott wave analysis: When world is on monetary easing, India fears for monetary tightening. Technical support for Nifty is at 5960 and then at 5910. Wild expiry ahead.

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

For 25 July 2013: -

On 24 July 2013, FII Sold INR 404.50 crs and DII Sold INR 328.80 crs

We have derivative expiry for July month series today. RBI added fuel for bears in this market which has brutally crushed banking and financial stocks. We need to be clear that RBI is giving hint for rate hike. The way recent steps come I am sensing for either CRR hike or repo rate hike or both. It is just not making sense but this is reality. It is my personal view that D. Subba roa become worse RBI governor of my life time.

Technical charts are suggesting that it has already broken the trend line of rising pattern. It is giving me resistance in the zone of 6020-6035 levels. Above 6035, I will expect for short covering on derivative expiry day.

In the down side we can expect support at 5670 levels. If it breaks then it can give 5940 to 5910 levels. Clearly, when rate hike fear comes then technical will go at back foot. So far, Indian market has shown great resilience. Situation will be worse if global correction begins.

We have a chance of rebound after gap down opening.

Strategy for Nifty July future – SGX JULY NIFTY is down by 40 points. There are chances that we will see opening near yesterday’s low. If it breaks 5970 then this market will find it tougher to rebound. Unfortunately, sentiment is worse on derivative expiry day. Only short covering rebound can help bulls. Real my intraday updates for more details.

S&P 500 – It corrected in the last trading session and came at 1685 levels. One needs to see for the support at 1675 level. Break of 1675 will give 1660. I still believe that after this pullback S&P 500 will rebound strongly to cross 1700 levels. It is better to see the pattern of strength to emerge which can either come at 1675 or at 1660 levels.

Regards,

Praveen Kumar

24 July 2013: Nifty Elliott wave analysis: RBI action will cause another gap down near 6030 – 6020 levels. I am hoping for recovery after gap down but this is just my hope. Read my real time study to know more.

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

For 24 July 2013: -

On 23 July 2013, FII Bought INR 211.36 crs and DII Bought INR 60.86 crs

These are small positive-negative data which really does not mean anything. It is still clear that FII has not shown confidence in Indian market yet. We got another mood dampener aftermarket hours by RBI.

The apex bank restricted the limit of individual bank borrowing to 0.50 percent of its total deposits (or net demand and time liability as it is known in banking parlance) outstanding as on the last Friday of the second preceding fortnight from the RBI's daily borrowing window called Liquidity Adjustment Facility (LAF) in banking parlance.

At the same time it scrapped its earlier measure that had limited the total LAF borrowings to the tune of 1 percent of total deposits or Rs 75,000 crore. It was effective from July 17, 2013.

So, prepare for another gap down. RBI will never learn with its action. Let me say one thing one line, lower growth is the root cause of higher NPA. Compromising growth can never be good for banking health which in turn is equally bad for economy.  

Technical charts are suggesting for support at 6020 and then at 5980 levels. It is looking like to open for 6020 levels. After that market will look for clarification from RBI. No pre market study can be prepared for gap down.

Strategy for Nifty July future – SGX JULY NIFTY is higher by 25 points. I am worried about market fundamental but I am not worried about market technical. It is still a buy. Technical charts are suggesting that it has some resistance at 6080. Cross above 6080 will drive this market higher on short covering. In short covering it may hit 6111-6133 levels.

S&P 500 – It hit a high at 1698.90. I have already said that it can be tougher to deal with 1700 psychological marks. Although, it is going to cross but will see some consolidation before that. This consolidation may give some price correction. I am expecting support to emerge in the zone of 1680 to 1675 only. It will be better if it touch 1675. This pullback can generate good momentum for another bigger rally. One sided rise is making it tougher to deal.

Regards,

Praveen Kumar

23 July 2013: Nifty Elliott wave analysis: I still hope for 6111-6133 levels before expiry. Some revival may come in banking stocks although it may be too dull.

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

For 23 July 2013: -

On 22 July 2013, FII Sold INR 406.02 crs and DII Bought INR 299.85 crs

One day it looks that FII are showing some interest in Indian market and very next day hopes fed away. This is the story of past 500 points of rises on Nifty. I can conclude that majority of selling goes in banking and metal stocks. Now, there are many bad earning hitting on street. All those bad IIP figures were giving this hint. LT comes with miserable set of numbers yesterday. This is perhaps the worse corporate earning in past many years.

It is the failure of policy makers who were active on papers but not on ground. When they come on ground they were just touching dirt. Any economy has to pay for this kind of inactiveness. Market has no hope from upcoming RBI’s monetary policy but it will look with some hope. Most of my study remains same before derivative expiry.

Technical charts are still suggesting for higher move and giving a hint for 6111 levels. Wave theory suggests that we are in the progression of wave ‘c’ which may finish in the zone of 6111 to 6133. There is a small concern that RSI is giving small negative divergence and it can be confirm if we start closing lower. So it is very important that Nifty need to get higher close. I am optimistic for higher closing. We are in derivative expiry week so I am expecting tremendous volatility.

Some short covering may come and those must govern banking stocks.

Strategy for Nifty July future – SGX JULY NIFTY is higher by 25 points. I am worried about market fundamental but I am not worried about market technical. It is still a buy. Technical charts are suggesting that it has some resistance at 6080. Cross above 6080 will drive this market higher on short covering. In short covering it may hit 6111-6133 levels.

S&P 500 – It is coming closer to 1700 marks. Yesterday it hit at 1698 levels. This hide and seek game may continue for today also. 1700 is a psychological resistance. It is looking to extend its gain once it starts trading above 1700 marks. Intermediate trading support will emerge at 1685-1680 levels. There is no great addition in technical studies. Expect more rise if stand above 1700. It is still a question if it can able to cross 1700 or not. So watch for this cross over.

Regards,

Praveen Kumar

22 July 2013: Nifty Elliott wave analysis: Can we expect more rise without participation from banking stocks? As long as 6000-5980 holds, Nifty may try to advance towards 6111-6133 levels.

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

For 22 July 2013: -

On 19 July 2013, FII Bought INR 252.26 crs and DII Sold INR 229.10 crs

FII has reduced the intensity of selling but they are still not buying in a confident way. They bought marginal amount on Friday. We got corporate earnings by HDFC which was disappointing but Reliance figures were stable. I still believe that Indian market is moving higher we are going under the phase of global rally. Last time when S&P 500 was at 1688, Nifty was at 6200+. Now S&P 500 is at same levels but Nifty is not even at 6100 levels. This has happened due to weakness in financial and banking stocks.

This rise becomes the story of rise in Reliance, ITC and HUL. This it is perhaps the first rally which moved without banking stocks. It is still a waiting time for banking stocks.

Technical charts are still suggesting for higher move and giving a hint for 6111 levels. Wave theory suggests that we are in the progression of wave ‘c’ which may finish in the zone of 6111 to 6133. There is a small concern that RSI is giving small negative divergence and it can be confirm if we start closing lower. So it is very important that Nifty need to get higher close. I am optimistic for higher closing. We are in derivative expiry week so I am expecting tremendous volatility. It is interesting to see how banking stocks are going to react now.  

Strategy for Nifty July future – SGX JULY NIFTY is giving a hint for flat start. It is even better what SGX Nifty was showing on Friday night. I believe that we can see the levels of 6111 to 6133 levels on July futures too. Technical charts are suggesting that as long as it is above 6000-5980 levels then we can hope for the cross above 6100 levels. As banks are not participating so it is not easy to bet big. It is looking like choppy session before hitting 6111 levels but key should be banking stocks.

S&P 500 – As hinted from past many days, it hit a new all-time high. So we got new all-time high on 18 July 2013 itself. Now there is a possibility of either price correction or time correction but this is not a compulsion. Technical charts are suggesting that as long as 1675 holds we can expect more rise. We may see find it tougher to cross psychological mark of 1700. If it has to cross 1700 then today might be a good day. even after fall in google and Microsoft, we saw better closing.

Regards,

Praveen Kumar

19 July 2013: Nifty Elliott wave analysis: Technical will be at back seat and will decide the levels for market. Technical support is at 6000 marks. Market eyeing on Reliance result.

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

For 19 July 2013: -

On 18 July 2013, FII Sold INR 178.29 crs and DII Sold INR 239.41 crs

Looking on above figures it is easy to understand that we have seen a short covering rally yesterday. For the first time we have seen some short covering in banking stocks. It was driven by better than expected result by Axis bank. Still, charts have not changed much for banks yet. It needs buying to get rid of pain.

I was already quoting for new all-time high for US market and we got it yesterday night. Even European market goes for newer monthly high. Comparing to any other indices, Indian market has not moved to that extent. It has happened due to tremendous weakness in banking stocks. Otherwise days would have been much better.

Yesterday, we got Axis Bank and TCS results. Both were better looking numbers in my view. Expect some good reactions on TCS today. Results for companies are not as poor as market did fear. We will get Reliance number today which may act catalyst for bulls.

Technical charts are advising long trades only. Technical support for today’s trading will be at 6000-5990. We have a chance of hitting 6111 levels on higher side. It should not be choppy days but things depend on many outcomes other than technical.

Strategy for Nifty July future – SGX JULY NIFTY is trading with loss of almost 30 points. It is at 6027 levels. Right now Japanese index Nikkei slipped by 550 points from high point. Overhang is reflecting on SGX Nifty. I am expecting support at 6010-6000 levels. If it has to hit 6110-6120 then it will not any day better than today. Let us see. We need to be cautious from topping formation. I hope that it will not come so soon but cannot deny such situations.

S&P 500 – Current formation is giving a hint that S&P 500 will give a new all-time high by July month itself or by first week of August.

So we got new all-time high on 18 July 2013 itself. I was expecting this to happen but it happen little earlier. Charts are saying that we may see the top formation now. As it is earning season so it may try to move beyond technical limit. My condition for newer life time high got satisfied. Time retracement is suggesting for 1700 which is make or break levels. Are we going to form top in USA? I have no answer today. I am avoiding fresh long as of now.

Regards,

Praveen Kumar

18 July 2013: Nifty Elliott wave analysis: It may generate momentum for a move towards 6111 levels. It has shown better respect for support at 5910 but crossover of 6040 it a tough job.

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

For 18 July 2013: -

On 17 July 2013, FII Sold INR 26.09 crs and DII Sold INR 73.86 crs

Indian market again moved from its intraday low and save any critical damage although banks were bleeding. HUL came to save in last hour of trades. Except banking, I do not see any big weakness anywhere. Other index component like Reliance, ITC and HUL are trading firm. Even banking stocks are extremely over sold. It is like the time is not correct for banking stocks as only adverse news are coming for the sector. Even HDFC Bank has disappointed on NPA front.

I already said yesterday that market should pick its own dynamics now. Index moved with some buying in index heavy weight stocks. Banking and metal stocks are near 52 weeks low. It is true that this is very rare of its kind. Ben Barnanke’s comments were favourable for emerging market last night. RBI should learn something from US fed. What RBI got from its recent steps? Rupee is still not showing strength.

Technical charts are advising caution as long as Nifty stand below 5980. It is looking tired and may be waiting for next trigger. Still I am feeling that Nifty is not ready to give up. Technical support is at 5910 and a tough resistance at 6035-6040 levels.

Strategy for Nifty July future – SGX JULY NIFTY is trading with a gain of 16 points. It is giving a tick of 5987. We need trades above 6000 levels to see a move towards 6035-6040 levels. Technical support will be in the zone of 5930-5920 zone. We may get some short covering support if it able to stand above 6000. We may have a volatile day but it may be useless unless we get higher breakout.

S&P 500 – Current formation is giving a hint that S&P 500 will give a new all-time high by July month itself or by first week of August.

It is silent near all-time high. It hit a high at 1685 and closed at 1681. Technical charts are generating a bullish pattern for a move towards 1700 levels. Technical support is at 1655 for short term and trading too. There is nothing to add more in analysis. Buy dip and hold for coming days.

Regards,

Praveen Kumar

17 July 2013: Nifty Elliott wave analysis: I have no great hope from cosmetic reforms. Market will choose its own dynamics. It will have support at 5910 and stiff resistance 6040.

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

For 17 July 2013: -

On 16 July 2013, FII Sold INR 357.40 crs and DII Sold INR 210.55 crs

FIIs are making exit from slower pace than compared to June month. It is not new to note that major big money is exiting from emerging market to an extent. Indian market is not in worse condition in term of money flow although Indian rupee has much bigger weakness. We have seen rise in Indian stocks against all add. Now, RBI gave a huge disappointment with a hint for rate hike. Recent steps are beyond my understanding. I strongly condemn any such steps which give a hint to compromise with growth with GDP nearing at 5%. This kind of steps can do irreparable damage and trigger massive slow down.  

Government of India gave nod to hike cap in 13 sectors. They hiked cap to 100% in telecom sector. Market may want to react or may not want to react. I said earlier also when they allowed FDI in retail last year that these are cosmetic reforms. I views remain same that these are cosmetic reforms. Tell me one thing how many dollar we got by allowing FDI in retail? I knew this to happen. It is not that foreign money is sitting with a line to come in India. We must need to improve economy and business environment first then only those steps can be effective.  

Technical charts are advising caution as long as Nifty stand below 5980. I said for two supports yesterday, one was at 5960 and another was at 5910. It fluctuated in that range with respect for 5910. I still feel that this market should not fall to any threatening levels. Only thing is that it needs to stand above 5980 to ease those fears of fall. Banking stocks are just turning hopeless.

Strategy for Nifty July future – SGX JULY NIFTY is trading dead flat ignoring all steps taken by government of India. If it manages to stand above 5990 then we can see the levels of 6040-6050 again which the next trigger for rise is. Technical support will emerge at 5940-5930 levels only. It is expected to be a dead day to trade.

S&P 500 – Current formation is giving a hint that S&P 500 will give a new all-time high by July month itself or by first week of August.

A pause was expected with some price correction or time correction. Correction length so far is from 1684 to 1672 which is acceptable. I feel that it may give some more pullback but 1655 should not break now. I feel that it is just an expected pullback before another massive rally. This pullback will end today or tomorrow only.

Regards,

Praveen Kumar

16 July 2013: Nifty Elliott wave analysis: RBI’s step will be disastrous for equity price. They handle one problem to give a birth of next problem. Technical support – 5960-5910.

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

For 16 July 2013: -

On 15 July 2013, FII Sold INR 227.25 crs and DII bought INR 454.28 crs.

FIIs are not looking confident on Indian market. They are giving preference to the developed market over emerging market. It can be sad that emerging market has better valuation than developed one but it is currency which is turning as deciding factor. Nifty stand above 6000 marks and it is itself a big thing.

Now Indian market needs a trigger of reform which can convince FII for their investment in India. Most important step will be bank rate cut but RBI governor keep on issuing adverse remark to give a jerk to the market. One such remark came last night too. We need to understand that India is struggling on food inflation which cannot be handled by rate cut. This is the reason that inflation remains higher in past four years. It is a big failure of RBI. Their attempt to handle inflation has given adverse impact on growth.

RBI issued series of steps to curb rupee decline by tightening liquidity and making dollar costlier to banks. The RBI raised the Marginal Standing Facility (MSF) rate and Bank Rate each by 200 basis points to 10.25 percent, capped the amount up to which banks can borrow or lend under its daily liquidity window and announced a sale of government securities through an open market operation.

This is going to give adverse impact on equity price today. Just think when market was demanding for better liquidity then are pulling out money. It is a disastrous step. When all global market hit their life time high in 2013, we left behind. This is the reason. It is the failure of correct policy making. Neither they can control inflation nor can they boost growth.

Technical charts are advising caution if Nifty stand below 5980. Till yesterday charts were saying for a move towards 6100 marks. Now the recent development is giving reasons for some correction. Trend reversal will not come as long as we are above 5900 levels. Expect a weak opening.  

Strategy for Nifty July future – SGX JULY NIFTY is trading with a loss of 55 points right now. It is trading at 5972. We are going to see gap down. Technical support will be in the zone of 5980-5970 zone. It is very important that it should not go below this range. If it saves 5960-5970 then we can expect intraday rebound towards 6020 again.

S&P 500 – Current formation is giving a hint that S&P 500 will give a new all-time high by July month itself or by first week of August.

It is playing hide and seek game near life time high. For short term it has entered in heavily overbought zone. In ideal condition, it should have some correction but I am feeling that correction is coming in the form of time consolidation. This may give few days of silence before a big storm to take away even 1700 marks technical support stand at 1660-1655. No correction can begin it below 1655 in any case. Use dip to buy only.  

Regards,

Praveen Kumar

15 July 2013: Nifty Elliott wave analysis: I said for 6000 well in advance. Now this market is looking to move higher again against all odd. Corporate earnings, RBI policy and global cues will be key factors.

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

For 15 July 2013: -

On 12 July 2013, FII bought INR 644.82 crs and DII Sold INR 144.97 crs.

FII has bought Indian market from past four trading sessions. Some may say that it is weaker rally but the fact is that Nifty moved higher by 450 points from its recent bottom without any great FII support. Just imagine, even rupee weakness has failed to stop Nifty from moving higher. This rise is a result of excessive pessimism and will have life as long as bears give fuel. Some correction here and there is possible but overall trends remains higher.

May month IIP Data - contraction by 1.60%. Means negative 1.60%. CPI came 9.87%. I fail to understand what RBI is doing and waiting for. I can clearly blame RBI for their inactiveness. Neither they are able to curb inflation nor able to support growth. My view is that be stop worrying (giving excuses) about inflation and do something for growth. I guarantee that with this kind of policy we will get just one thing – Slowdown in India. Auto sales figures are already showing this pain.

Difference between hope of rise and fear of fall is just one person – RBI governor.

Technical charts are suggesting that we may have some pause but rise should continue. We already got reverse H&S break out. It is giving some elevated targets. I expect trading support at 5970 and trend support at 5940. On higher side crossover of 6035 should give 6100 levels.

Keep an eye on corporate earnings. Market may reward even those results which are in line with expectation.

Strategy for Nifty July future – SGX JULY NIFTY is trading on dead note. Take a note that it was trading with a loss of 30 – 40 points on Friday night. Market is expecting that bad economy data should put pressure on RBI for rate cut. Technical charts are suggesting for a move towards 6100 levels. Intraday long is possible only on the cross of threshold of 6040.

S&P 500 – Current formation is giving a hint that S&P 500 will give a new all-time high by July month itself or by first week of August.

It came at 1680 and it is just 8 points away from its all-time high. Road map of S&P 500 is stronger than any index of the world. It is rising from 1560 and one pullback seems to be due but this is not a compulsion. We are going to see new all-time very soon. Take a note that small cap index Russell 2000 is already come at new high. Note that maximum pullback can bring S&P 500 at 1655, not more than that. Suppose if it crosses 1688 then expect runaway move towards 1700. I will use any dip to buy only.

Regards,

Praveen Kumar

12 July 2013: Nifty Elliott wave analysis: Do not think that rally is going to end in any easy ways. More upside is expected towards 6100+ levels. US indices go on all time high close.

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

For 12 July 2013: -

On 11 July 2013, FII bought INR 638.26 crs and DII Sold INR 234.61 crs.

Without any great participation from FII, Nifty has bounced almost by 400 points. This bounce came against all odds. Just think that when Nifty were at 5900+ last time, Indian rupee was at 57. This time it came above 5900 when Indian rupee is coming at 60. This is relative great strength of Indian market. If Indian market is a laggard then only and only policy makers are responsible.  

RBI comes out with pessimistic thoughts about rate cut. Their actions were justified when GDP was at 7% and inflation was at 9%. Same action cannot be good when GDP is coming at 5% and inflation below 6%. Every economy always has some problems and it is the duty of policy makers to find mid-way.  Rate cut is desperate need of economy. I am not talking about stock market, I am talking about economy. It seems that RBI can give rate cut in a phase of stagflation. Is RBI waiting for negative inflation?

Technical charts are suggesting for the test of 6000 marks by today itself. Technical support will emerge at 5900 levels. Do you know that Nifty has 50 days moving average at 5916 which it has already crossed yesterday?

All eyes will be on Infosys result. Technical charts are giving a hint for some positive outcome of upcoming quarterly result. Let us see if we get some reasons for rise.

I like to watch for recovery in banking and metal stocks. These two sectors have not participated at all in the recent 400 points of pullback. Many stocks are still near multi year low, example is Tata Steel.

Strategy for Nifty July future – SGX JULY NIFTY is trading higher by almost 35 points which is indicating for higher start. Right now it is at 5970. This was looking impossible just few days back. Technically, Nifty would like to make attempt to cross 6000-6012 levels. Cross over of 5980 on 5 minutes charts will give rise towards 600-6012. Technical support will emerge at 5916-5900 levels.

S&P 500 – Current formation is giving a hint that S&P 500 will give a new all-time high by July month itself or by first week of August.

As said we got new all-time closing high on 11 July itself. One can expect a small pullback before crossing 1688, if it has to come. Very soon next week we will see S&P 500 crossing above 1700 levels also. It may have Friday’s pullback. Strong technical support will be at 1655. Believe me; you will get July high which perhaps only few people can think. I am strongly bullish since 1560 in US market.

Regards,

Praveen Kumar