23 December 2013: Nifty Elliott wave analysis: Technical charts are justifying more extension of rise with possibility of short covering. I still advise caution at higher levels due the history of trapping bulls above 6300 !!!

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

For 23 December 2013: -

On 20 December 2013, FII Bought INR 990.19 crs and DII Sold INR 247.55 crs

It was a great trade for weekend. Nifty shoot up above 6230-6236 levels and goes higher by 50 points more. Now, it is looking to hit 6320 levels which is at the distance of 50 points from here. As long as Nifty is above 6230 support levels, we can expect strength and attempt for a move towards new all-time high. Why India should left when world is enjoying “Santa Rally”.

It is equally true that 6300 levels had always formed a trap for bulls in past.  Good thing for this time is that it is bouncing again without breaking 50 dma. We saw rise in Reliance. Indian market has a history of topping out with rise in Reliance.

I will be cautious at higher levels but I will prefer to trade long. We can expect good activity in high beta mid cap banks now. Auto, technology and pharma stocks are looking good for the day.

In short, trade long as long as 6230 holds. One thing is clear that Indian market is not moving like other global indices. We are on long term ‘inverse H&S pattern’ but not breaking higher on decisive basis which most global indices has done six months back.

For the day, I am expecting 6320 as first target and if it sustain at 6320 then you can expect good rise towards 6360 also. Pure, charting basis, crossover of 6230 may result 6500 also.

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

Strategy for Nifty December future – It is likely to open with some strength. Nifty future is almost running with small premium value near to derivative expiry and it has some hope of short covering rally too on expiry week. Technically, 6360 may be on test. Higher levels will not going to be stable. Immediate trading support will be at 6280. Expect 6360 as long as it holds 6280 levels. Do not short this market unless some real big sign of troubles comes. Nothing looking like that. We passed the levels of sign of worry.

S&P 500 (USA) – It goes above 1814 and settled well above those. So, this can be surely named as “Santa Rally”. Logically, it is an opening for a move towards 1854 levels. Still 3% more rise has left for this month. 2013 is a historic year for bulls. It opened on strong note and remains strong throughout the year. It has started from 1470 and running at 1820 now. I am considering 1814 as new crossover and breakout point for bulls.

Regards,

Praveen Kumar