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