31 October 2013: Nifty Elliott wave analysis: Fed comments are less dovish than expected and going like no event for Indian market. Important trading support is at 6200. If it breaks then only we can expect decisive dip. Expect volatility.

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

For 31 October 2013: -

On 30 October 2013, FII Bought INR 1016.77 crs and DII Sold INR 550.60 crs

Above figures shows that FII has gave their best but still nifty stopping near 6250 only. Now we have derivative expiry today. Global cues are not as good as market was needed. I feared this and strongly suggested “not to buy” even on break out.

Asian markets suffered a glancing blow on Thursday after the U.S. Federal Reserve's latest policy outlook was deemed less dovish than some had wagered on, lifting both bond yields and the dollar.

I feel that fed meeting goes as no event so far for the world as reactions are very limited and expected. We are on derivative expiry day and almost on multi year high. Nifty has closed exactly at 6252 levels. Technical charts are definitely advising caution but not giving any big sell for threatening fall yet. It can emerge today but who can predict derivative expiry day. It should be extremely volatile.

What is the possibility of hitting new all-time high? Well, if it has to happen then it will happen only on Muhurat trading day. Before that, we need to see what is going to happen today and how market close for this month series. I am concluding this as we may not get any big trigger to sell in just two days.

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

Strategy for Nifty October future – NIFTY future is likely to open down a little today. It has trading support at 6220 only. Suppose if it breaks 6220-6200 ranges then only we can think for decisive dip. Well, there is no great reliability for expiry day. It depends on traders if they want to hold long or want to cover long. On higher side 6270-6280 will act as stiff trading resistance. I am repeating that if we close with even small negatives then we are very close to get new all-time high on Muhurat trading day. This will come due to euphoria. We should get a dip before that. If it comes today then it will be better.

S&P 500 (USA) – I am giving a strongest possible warning – RSI and MACD divergence is giving sell after sell. This divergence is running from 1690. Do not believe the momentum blindly.

USA got independence in the year 1776. Some coincidence as S&P 500 makes top at 1776 which can be a short term top. Equally a figure which is just very near to expected 1780. I believe that US market needs few more trading sessions to realize that they are close to tapering. There must be something more to cause a dip. Let us see today’s session. Break below 1760 should actually give hint for 1730.  

Regards,

Praveen Kumar