11 July 2013: Nifty Elliott wave analysis: Post Barnanke’s comment, expect a blow up opening. Will it give a cross of 5906 now? Expect massive recovery in banking stocks too.

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

For 11 July 2013: -

On 10 July 2013, FII bought INR 75.46 crs and DII bought INR 28.78 crs.

FII were net buyer in cash market even after panic sell off in last 90 minutes of trades yesterday. It was bad news flow over Reliance which triggered selling. I strongly believe that that news flow may not affect stocks price. Talk of gas price ceiling has not practical sense.

European market closed in red last night but still those were stable. Federal Reserve Chairman Ben Bernanke said on Wednesday that the U.S. economy continues to need highly accommodative monetary policy. It gave a strong boost to US market future. This news gives a positive edge to emerging market like India.

One can expect higher and kick off opening. I am expecting 100 points higher opening and then we will see the importance of 5906 levels. I have already said earlier that one should use current consolidation to buy. Not to make exit. Charts are suggesting that we will see a further move towards 5950 on the cross of 5900-5906 levels.

We will see improvement on Indian rupee too. As of now I am seeing appreciation on Indian rupee towards 58. Shocked? It is definitely expected after fed comments. Last thing I want is that RBI should also go in action and give us a repo rate cut. Note that Indian rupee closed on very good note aftermarket hours.

If some conditions satisfy then we will see the beginning of journey towards new all-time high.

Strategy for Nifty July future – SGX JULY NIFTY is trading higher by almost 92 points which is indicating for higher start. Right now it is at 5902. If we get further follow up (which may come on short covering) then we will see a big rising day. Cross above 5906-5916 will give me levels above 5950. Will this act as bull’s gap up? Yes, it can. I bought this consolidation and will bet for higher 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 it has crossed 1655 but closed just below. On higher side crossovers of 1655 will give a move towards possible new all-time high. So, S&P 500 is moving for further 2-3% rise. Now technical support will stand at 1640-1627 levels till it make new all-time high. I have already indicated for this recovery earlier starting from 1560.

Regards,

Praveen Kumar