23 October 2013: Nifty Elliott wave analysis: 6240 or 6160 – Which side will it break first. We are likely to get 160 points move after this range in same side of break over. Market goes clueless now.

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

For 23 October 2013: -

On 22 October 2013, FII Bought INR 794.90 crs and DII Sold INR 845.30 crs

Indian market turned dead in past two trading sessions and just hovering near 6200 levels. It is neither breaking 6160 on lower side nor breaking higher above 6240. In fact two day’s range is just 6163 to 6220. We saw some rise in mid cap and small cap index. It is showing that people has shifted their focus from large cap to small cap stocks. This generally happen after big rally. In normal condition, this is a sign for the continuation of the rally.

We can be concerned only if small cap and mid cap index starts underperforming but such conditions have not arrived so far. Nifty is odd 2.50% from its all-time high while Sensex is moving more rapidly towards its all-time high.

I said earlier this week, “In short, Monday, Tuesday or Wednesday, a short term top is coming. Now, it can be at 6240 or 6300 or even may be nearer to new all-time high at 6360. I would rather be very happy to see 6360. Note that I am not claiming for new all-time high, it is just my excited optimistic thought of a hardcore bull of past few weeks.”

We are on Wednesday. Let us see what is coming. We have not seen the cross of even 6240. The range of 6160 to 6240 will makes a trader more confused. Shall you short on anticipation of pullback due to negative divergence or shall you go long on momentum based on money flow? It is still a billion dollar question.

For today’s trading, keep an eye at 6160 for Nifty spot. It is likely to see a fall if breaks 6160. Technical resistance is at 6240. Let us see what is coming. I was on soft short side but I exited yesterday and turn on neutral side for fresh decision.

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

Strategy for Nifty October future – NIFTY future may open on another flat opening. I hate this kind of movement. It can just confuse for direction. I am still considering 6240 – 6260 as stiff technical resistance. In lower side, it will get support at 6160-6170 levels. Which side will it break? It is better to go for wait and watch mode. At least I doing that.

S&P 500 (USA) – I have quoted for a move towards1760 well in advance. Look at yesterday’s high, it is 1759.33. How many have quoted this? More important question is what is coming next. One simple line, “Either it should end at 1760 or it will go to hit 1784. If it coming above 1760 then probability is higher for even 1800.” In short, US indices are on euphoric mode. I am expecting a topping formation but confirmation is still missing.

Regards,

Praveen Kumar