16 September 2013: Nifty Elliott wave analysis: “No Lawrence Summer rally” in US Future. Nifty is likely to re-test 5932 and hence resistance zone 5940-5960 comes in definition again. Will it hit 6000 or miss 6000?

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

For 16 September 2013: -

On 13 September 2013, FII Sold INR 98.00 crs and DII Sold INR 152.09 crs

Treasury futures contracts rose after former Treasury Secretary Lawrence Summers withdrew his name from consideration to be chairman of the Federal Reserve.

Speculation that Summers would be nominated and would push for the Fed’s bond-buying program to be unwound quickly had spurred declines in Treasuries. Fed Vice Chairman Janet Yellen is also a contender to replace Chairman Ben S. Bernanke when his term expires in January.

Whole global futures are enjoying massive rise on Monday morning when it was looking that rally was t its last leg. I was heavily bullish earlier and turned my position for correction after Nifty hit a high at 5942. Now it seems that market is trapping bears again and I am also one such who might be under trap. Good part is that I am shorting from good extreme high point. Still, my shorts would be down under water.  

There is practically no meaning for technical analysis if gap up comes. It is just the time to quote the resistance of 5940 to 5960 again. I cannot deny the possibility of hitting 6000 also in extreme case but it is very unlikely. Should I take out short or should I add more shorts? I feel that I should add more shorts on this rise but only on some technical signals. It is going to be challenging Monday for bears.

Visit again to read my intraday updates as I can update about those only during market hours.

Strategy for Nifty September future – SGX Nifty is trading at 5956 which is way higher on “No summer” rally. 5955 is previous monthly high. Surpassing 5955 may generate a possibility of 5980-6000 levels. For bears, it is very important for Nifty to stay below or go below 5955. I believe that first selling should come from USA but those markets has strong positive news flow. What can stop rally in USA, can stop India too. I said earlier, not to be panic at 5300-5200. I am saying with equal emphasis that does not be extra courageous at 5900-6000. Take this more like technical words rather than a trapped bear.

S&P 500 – I can break my head now with Lawrence Summers. I was betting on 1690 as decisive top but it is very likely to surpass that resistance with today’s gap up. This is going to be event based rise and definitely taking out comfort from bears. Well, but technical set up is just remains same. I always believe that USA market has strongest bull of the world who can save any dips.

Still I feel that charts are just advocating for a fall coming. What will bring that fall? Will today’s rise get sold at high? I like to be on wait and watch mode. Above 1690, I am forced to accept for the levels near 1705-1710.

Regards,

Praveen Kumar