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