28 February 2014: Nifty Elliott wave analysis: 6262 to 6285 levels are also looking achievable. Higher levels demands extreme caution. We are close to the short term top but still not on exact top.

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

For 28 February 2014: -

On 26 February 2014, FII Bought INR 511.15 crs and DII Sold INR 251.91 crs

Its US indices which have refused to give up from current levels while EU indices have given signs of pause. It is saving Indian indices. In fact it moved higher against all technical odds. Even in doubt it is coming near 6300 levels. I am expecting gap up after this holiday. It is looking to surpass 6262 resistance marks in gap up and may achieve 6285 in opening minutes. This kind of gap up normally eats all possible intraday opportunity.

I cannot say that there can be any good strategy on very first day of this month series. Once it opens with a gap then goes on silent mode. It is not possible to long either without correction. Signal to shorts are also not coming at higher levels too. History suggests that Nifty always truncate at 6300 levels. Nifty is just her and there at 6200 levels since mid-September 2014 itself.

Today it is going to be 18^th session from the low of 5933. I expect a top to form again in few days of time. This time traders should prefer to exit their investment portfolio too. It is saving as long as global market supports. Only banking and technology stocks are looking to move higher with some gains. Mid cap and small cap indices are not as strong as nifty.

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Strategy for Nifty March future – Closing above 6270 is generating for further up move for target near 6310 but those may come as gap up. There will not be much to trade higher after gap up. If it falls from high then only we can have trades. 6310 levels will act as tough resistance. Will it give me signal to short? If not then I will not trade.  

S&P 500 (USA) – It has in the band of 20 points from 1840 to 1860. Break on any side will cause nearly 2% moves in same direction. It means that if it breaks 1840 then we can hope to get 1800. If it breaks higher above 1860 then we may see 1888-1900 levels. I have not seen real selling pressure the way I was expecting. I suggest waiting for decisive move. It is looking like market can flush bears again at all-time high before giving correction. It is really irritating move we have lesser choice.

Regards,             

Praveen Kumar

26 February 2014: Nifty Elliott wave analysis: Do not get tempted on derivative expiry. Valid resistance for Nifty is at 6242 to 6262 and support is at 50 DMA, i.e. 6180. Next wave of sell off can be global in nature.

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

For 26 February 2014: -

On 25 February 2014, FII Bought INR 423.41 crs and DII Sold INR 289.12 crs

Nifty has closed at 6200. It is not a bad close but it is surely a close which demands higher degree of caution. A small negative divergence has emerged on MACD hourly chart. We have derivative expiry of February month series today. I was expecting a global sell off to come but it is not happening yet. Many major global indices have a chart set up which is suggesting that whenever next wave of correction will come it will come with massive intensity.

Well, so far every index is either on life time high or at 52 week high except Indian market. 50 DMA for NIFTY is at 6180 now and this will act as strong trading support. If it breaks and stay below 6180 then we can think for the next support at 6150. Derivative expiry can makes the thing more complicated.

On higher side 6242 to 6262 is still valid resistance. As long as Nifty is staying above 6195 it has a possibility of higher test before next sell off.

It does not matter what short term charts are telling us. Long term charts are issuing the signs of warning for a brutal sell off of wave “C”. This can come any day and anytime. Hence, keep your eye on global market too. Reason can be anything for sell off and this kind of signal cannot be ignored because is raising form little longer and already entered in over bought zone.

Nifty charts are suggesting that as long as it is above 6150 there cannot be anything to be worry for bulls so far. Let us see what is coming. I find options as safer way to play contra shorts as technical signals are still for buy-and-hold mode. We have derivative expiry today.

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Strategy for Nifty March future – Crossover of 6205 has a hint for 6240 but that came as a gap. It will take a dull opening but rest part of the day is going to be wild due to derivative expiry. I can find decisive trading support at 6105. Resistance will emerge at 6260-6270 levels. Nothing can be sure for expiry day.

S&P 500 (USA) – It almost remains unchanged but closed below 1850. I will keep my study same as of yesterday. It is looking like a short term top or very close to short term top. I have noticed an interesting pattern. This is only the first time that S&P gave intraday breakout but not closing near day’s high. I am still shy for long deals. It is better to wait for the beginning of storm does not matter which side it comes. High possibility is that it will go lower only but so far we have good signal to short either.  

Regards,             

Praveen Kumar

25 February 2014: Nifty Elliott wave analysis: Nifty can achieve 6242-6262 once crosses 6195 but this rise may truncate today at higher levels after a gap up. These are last days of rise. Do not get tempted a day before derivative expiry.

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

For 25 February 2014: -

On 24 February 2014, FII Bought INR 266.87 crs and DII Sold INR 248.49 crs

We had a gap down on 27^th January 2014 from 6263 to 6186. After US market rise last night, we are going to see the partial filling up of this gap with gap up only. As of now SGX Nifty is suggesting for a gap up of 30 points. This kind of runaway gap normally takes out all trading opportunity in the same direction of gap.

It has gained over 0.50% yesterday and India VIX came at 14.35. We must note that most of the time fear low comes at 14 historically. Zone of 13-14 may be enough for the bottom for VIX. My views for nearer resistance and sell off are based on the patterns emerging on global indices. This situation will be clear in few days’ time.

Nothing can be sure while we go in trade but it is likely to form a short to medium term top very sooner. It has technical trading resistances at 6212, 6242 and final resistance at 6262. Anyone is likely to be under test. I cannot deny the possibility of even 6262 levels.

It does not matter what short term charts are telling us. Long term charts are issuing the signs of warning for a brutal sell off of wave “C”. This can come any day and anytime. Hence, keep your eye on global market too. Reason can be anything for sell off and this kind of signal cannot be ignored because is raising form little longer and already entered in over bought zone.

Nifty charts are suggesting that as long as it is above 6150 there cannot be anything to be worry for bulls so far. Let us see what is coming. I find options as safer way to play contra shorts as technical signals are still for buy-and-hold mode. We have derivative expiry tomorrow.

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Strategy for Nifty March future – At a cross of 6205, it is likely to test 6240 which will be achievable by today morning. Scope of further rise or trading rise will be very limited if it open with gap up near 6260 as indicated by SGX Nifty. So far it is a buy but RSI goes on critical resistance line. It may be wild a day before derivative expiry. I am lot interested in finding signals for short and then applying on it. If fall comes it can be really huge. Do not short in the absence of strong sell signal.  

S&P 500 (USA) – It hit high t 1858 and closed at 1848 which is mid-point of intraday range. It is looking like a fake breakout. CBEO VIX is moving higher from 14. Take a note that VIX is at the same levels as of 1810 and this is usually first indicator to give sign of top. Still, in US market bears have nothing to do when bulls goes in command. It is looking like a short term top or very close to short term top. I have noticed an interesting pattern. This is only the first time that S&P gave intraday breakout but not closing near day’s high. I am still shy for long deals.

Regards,             

Praveen Kumar

24 February 2014: Nifty Elliott wave analysis: 6195 may be a possibility above 6160 levels but I still feel that 6160 is a suitable level for the end of relief rally. Keep your eye on global market too. Derivative expiry is nearer.

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

For 24 February 2014: -

On 21 February 2014, FII Bought INR 603.41 crs and DII Sold INR 381.55 crs

Has Friday’s closing has shocked me? Yes, it has. I was not expecting the retest of 6160 but it happened. Should I change my view? My answer is no. it is tug-of-war like situation for bulls and bears. Cross over of 6160 may invite a move towards 6195. I am not saying that it will able to hit 6195 or not but it may take an attempt.

It has gained over 1.10% on Friday and India VIX came at 14. We must note that most of the time fear low comes at 14 historically. Zone of 13-14 may be enough for the bottom for VIX. My views for nearer resistance and sell off are based on the patterns emerging on global indices. This situation will be clear in few days’ time.

For Indian market, it is cement and technology stocks which are on front seat. Those are still looking stronger to save market. Financial and banking stocks may fail at higher levels again. I still feel that traders and investors should avoid aggressive long in this range. We will sooner find this market losing momentum. There might be stock specific long trade opportunity like Cement stocks but broader market is not as stronger.

For today’s trading, if it fail to cross 6160 then I can expect returning of last Thursday’s levels. Else, I need to plan trading assuming 6195 as also another possibility. It is definitely not easy to make strategy in bear mode if it goes above 6160. Remember, market is not going to give easy moves anytime.

After a very long time, I am saying to exit from your entire delivery holding. Above comment does not have much sense if market already starts slipping? Keep your eye on global market too. A brutal “C” wave sell off may come.

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Strategy for Nifty March future – I am now analyzing March month contract now. It has closed at 6200 levels with premium of nearly 40 points. I strongly believe that by derivative expiry of Wednesday it will just have 20-25 points of premium so it can give me some extra advantage on short side. 6205 is a stiff resistance. Once it maintains levels above 6205 then it can try to catch for 6240 also. So far, I am planning to short the rise on some intraday sell signal which will either come on failure near 6205 or from 6240.

S&P 500 (USA) – On Friday’s session it has slipped from 1846. More importantly it closed at 1836 which is just the day’s low. This is confirming the importance of 1850-1854 resistance levels. We have very high possibility for the beginning of crack down this week. It may be decisive and must come sooner. In my view it should come any day and anytime from now onwards. Keep stop loss at 1854. Every decisive move has a confirmation point. For the downside, confirmation point is at 1824 as of now. It is little too far but odd can occur any moment.   

Regards,             

Praveen Kumar

21 February 2014: Nifty Elliott wave analysis: No bounce can save at higher levels. We may have another day when we will see closing near day’s low. Ley support for Nifty is at 6075 and key resistance is 6145 to 6160.

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

For 21 February 2014: -

On 20 February 2014, FII Bought INR 206.46 crs and DII Sold INR 600.71 crs

It was choppy session throughout the day except last hour crack. Note that now a day most of the time market got sold in last hour. This is itself showing a bad market mid set for bulls. Yesterday’s low was near 20 DMA support. I can say that bounce in global market is saving Indian market so far. Magnitude of bounce should be better than what it actually came.

S&P 500 came at 1847 which is near to all time high after hitting 1737. On other hand Nifty bounced only near 6156 which is 4-5% away from its life time high. This might not look the fair comparison but true in broader sense.

What I mean to say is that imagine the day when US market will actually go under correction which is due from longer than expected time. Now, we have a possibility of that coming sooner. I still believe that a hard correction will come in US market anytime now. It does not matter if it come from 1850 or from 1888 but it will come.  

For today’s trading, we will see some higher opening due to strong rebound in US market last night. Impact will be lesser than what it looks. Nifty will find 6130 as tougher resistance to cross. If it opens near 6130 then immediate resistance will be at 6160. I will surprise to see another day where market close near day’s low. Use this level to exit your all long.

After a very long time, I am saying to exit from your entire delivery holding. Above comment does not have much sense if market already starts slipping? Remember, we are going for derivative expiry sooner now.

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Strategy for Nifty February future – We will get two stiff resistances to deal, one is at 6140 and next is at 6167. Even 1% relative rebound for US market has failed to impress SGX Nifty which is just 20 points higher. I still say that Nifty may be very close for wash out now. Technical support is on dot at 6100. If it breaks then we can expect more and more panic. Even global support may not help at this point. Let us see. My above comments are applicable for all emerging market.

S&P 500 (USA) – It has bounced again from lower levels and from key support of 1824. I should not wonder as US has strongest bulls and they cannot give up so easily. I still believe for the possibility of hard sell off coming as long as it is below 1850-1854 levels. Perhaps after more than a year bulls looks tired and their efforts may got sold near 1850. Let us see where we will get the weekly closing now. I still say, press stop loss at 1854 and go short.

Regards,             

Praveen Kumar

20 February 2014: Nifty Elliott wave analysis: We may have a blow up top yesterday which same after breaking 6145 to misguide. Negative close can confirm the beginning of another correction.

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

For 20 February 2014: -

On 19 February 2014, FII Bought INR 468.47 crs and DII Sold INR 338.74 crs

It has finally crosses 6145 in final minutes of trades yesterday. You can refer to the chart, volume has dropped. We got four days of rise and today is fifth day. We may get a possible reversal now. I have already advised caution as S&P 500 was coming near 1850. US market fears that perhaps we may see the end of low-bank rate era. Now market will try to imagine life without stimulus and without low bank rate. We saw sell off in US market last night. I am expecting lots of readjustment in many emerging market currencies now.

Above news is surely bad news for emerging market like India although it may not have too bad meaning for USA itself. I have already named yesterday’s rise above 6145 as misguiding top. I have suspected for a bear down for today. Suddenly market got reasons too. It is looking like 6160 is going to be top for some time.

For today’s trade, one can use intraday pullback to short this market. Remember, firstly tapering and then fear of rate hike in US will hurt banking stocks most. There is no point to guess when US will hike bank rates. It is just enough that they will hike at some point sooner than what market was anticipating. It is not panic kind environment but surely a setback.  

Let us see how market will react today. The future course of action will depend on today’s closing levels.

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Strategy for Nifty February future – I believe that yesterday’s last minutes buying came as misguidance. Such blow up top used to come in past also. We are on resistance of 6160. It is looking like market has thrown weaker bears yesterday. It is looking like market will open below yesterday’s low of 6129. If it sustain below 6129 then we can expect 6100 to 6080 levels too. Yesterday’s high of 6168 will be key resistance. Do not opt fresh short if it able to save 6129 by any chance.

S&P 500 (USA) – So, how was that? We got a high at 1847+ yesterday and then a wash out fall to close at 1829. Congratulation to those who went short on S&P. Market fears that perhaps we may see the end of low-bank rate era. Now market will try to imagine life without stimulus and without low bank rate. Charts are suggesting that wave “C” has started now. If I am right then this wave will give bigger pain to bulls because it can drag market for 100 points fall. Keep stop loss at 1854 and hold all shorts.

Regards,             

Praveen Kumar

19 February 2014: Nifty Elliott wave analysis: Now 6145 is next threshold level to buy for a move towards 6200. If it fails at 6145 then it can begin correction anytime. Today is make or break day.

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

For 19 February 2014: -

On 18 February 2014, FII Bought INR 292.23 crs and DII Sold INR 154.83 crs

Test of 6100-6105 was looking obvious but a move towards 50% retrenchment is surprising. It came at 6142 and this may have invited many temptations for long side. Mid-point of fall from 6356 to 5933 is at 6145.

It gave up some gain in last 30 minutes of trades but this does not reflect anything. Now for today the battle begins for 6145 from bulls’ side and 6100 for bear side. It is not going to be easy for anyone now. I am also expecting that global market should undergo a correction after recent rise.

It is also looking that if Nifty manages to move above 6145 then we can expect a move towards 6195-6200 levels. It was banking stocks which have finally participated in rise. Now, we should see if banks will get follow up of buying. If this happens then only we can expect the cross of 6145.

For today’s trading, once again be cautious at higher levels and do not buy unless it goes above 6145. Rest, we can able to decide only during market hours.  

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Strategy for Nifty February future – Based on daily charts, Nifty future has strength and looking like some steam has left. Well, hourly chart does not have same view. We should not opt buying unless it goes above 6160 levels. If we get follow up buying in bank nifty then only we can expect higher crossover to come. We can expect trading support at 6115-6100 levels. If it breaks 6100 then only it can move on concerning note. S&P 500 (USA) – As expected it came above 1840 but on surprising side it has not shown any sign of weakness yet. Will bulls surprise market again? May be, I cannot deny. In US market bulls are in full command from past more than year. I still like to focus on 1850 to 1854 as most crucial resistance. If it manages to surpass above 1850-1854 then one can expect a run for 1888-1900 levels. In that case correction will be denied for longer. In the downside, break point is at 1828, i.e. little too far. I still like to issue the warning for today-tomorrow and day after tomorrow unless S&P goes above 1854 successfully.

Regards,             

Praveen Kumar

18 February 2014: Nifty Elliott wave analysis: Analysis remains same. Nifty has stiff resistance at 6100-6105 zone. Be cautious at higher levels. It will be safe to buy only above 6105.

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

For 18 February 2014: -

On 17 February 2014, FII Bought INR 522.82 crs and DII Sold INR 245.17 crs

Nifty remains near 6075 and practically never stand well above this level. Still, nothing bad on trading chart yet. A pause always does not mean for top. I can still emphasize that moving ahead 6100-6105 will be extremely tougher resistance. Nifty took a turn from this resistance for multiple times. If things will remains like this then we may see tougher to cross.  

It will be better and safer to play long once it takes out this resistance mark. Private sector banks have seen improvement while PSU banks are still not showing any good sign of revival. I can conclude that PSU banks and Reliance is still trading on concerning note. This makes me skeptical towards buying. I am not bearish yet but I will not try to buy either except momentum.

Technical charts are still suggesting that if Nifty stands tall above 6075 then it can try to come near 6100-6105 marks for once. It is still not going to be easy as writing an article.

My strong word of caution is coming from US market. Does not what futures are showing. S&P 500 is coming towards 1850-1854 resistance marks and I can expect a violent reaction. If reaction comes to surpass 1854 then only we can think about next round of money coming to equity. This is going to be big if it fails to cross 1850-1854.

For today’s trading, cautions are advised at higher levels. 6100-6105 is still looking tougher to cross. Good trading support can be expected only near 6030 levels.

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Strategy for Nifty February future – I have off loaded my long yesterday only. Now, I like to see reactions in the zone of 6115-6126 zone. Simple way is, from higher levels nothing is safer unless it go above 6126. Any failure at top will again result the fall. Note that it is just100 points band on Nifty to trade. There is no sign of decisive break on any side yet. Let us see what can be done. It is going to open flat.

S&P 500 (USA) – When it was looking like bulls were changing their mind, they took charge again. It is another quicker 100 points rally on S&P. Now it is just 11-12 points away from technical resistance of 1850 and this is life time high too. In previous rising wave I had quoted 1854 as technical resistance when it was near to 1850. I like to quote 1854 again for this time. If it crosses 1854 then it can raise the possibility for 1888 levels. Logically, we can expect good trading support at 50 DMA only which is at 1810. My view is – Do not add fresh long near 1850. Book your profit on long deals and wait for the market reaction at 1850-1854. Think to buy above 1854.

Regards,             

Praveen Kumar

17 February 2014: Nifty Elliott wave analysis: Once again, Nifty has resistance at 6075 and then at 6105. Nothing is safe at higher end near 6105 unless it breaks higher which is tough – tougher !!!

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

For 17 February 2014: -

On 14 February 2014, FII Sold INR 15.86 crs and DII Sold INR 45.00 crs

Nifty rebounded exactly from 200 DMA which was at 5981. It has closed at resistance point near 6050 with massive momentum. I can still say that 6105 will act as stiff resistance although we may come close to this level. One can be bullish for trading but cannot bullish for positional yet.  

Have a look, S&P 500 rebounded 100 points from their recent low (from 1737 to 1839). In the same time Nifty just able to manage from 5933 to 6048. Well, we have interim union budget today. Practically, it does not make sense if market wants to react with it. If this happens then it will be only media and their hype driven. So, it will be better not to watch and conclude for those. Stick with global cues and chart pattern.  

We may perhaps see the momentum to continue in first hour of trade. If it opens above 6075 then it may challenge the levels of 6100-6105 also. Question is will it try? Simply, why to break head? Wait for the break above 6105 to add fresh long. We took long on Friday which we will book and then go for wait and watch mode.

So far, this is like buy at 6000 and sells at 6100. It is just odd 100 points only and very hard to answer how many times it can repeat. I can simply give one hint that our market may head for a real big surprising move but that’s looking little far from now. For today, technical support will be at 6026 and 6000. On higher side, it has only meaningful resistance at 6100-6105 if it opens above 6075.

One more thing, SBIN result is not as bad as media people are saying. NPA is still a concern but these are known facts. There were times when this stock was at 3000 and all media people were praising it. Actually, those were the times when things were going wrong. What we are seeing now is just the consequences.

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Strategy for Nifty February future – It has added lot of long position due to some short covering activity on Friday. It was just one hour of trades which has changed the things. Think for some more rise if it can able to stay above 6085 levels for first 15 minutes of trade. I have already added my long on Friday’s sessions near 6010 and I will try to exit near resistance. Simple way is, from higher levels nothing is safer unless it go above 6126. Any failure at top will again result the fall. Note that it is just100 points band on Nifty to trade.

S&P 500 (USA) – When it was looking like bulls were changing their mind, they took charge again. It is another quicker 100 points rally on S&P. Now it is just 11-12 points away from technical resistance of 1850 and this is life time high too. In previous rising wave I had quoted 1854 as technical resistance when it was near to 1850. I like to quote 1854 again for this time. If it crosses 1854 then it can raise the possibility for 1888 levels. Logically, we can expect good trading support at 50 DMA only which is at 1810. My view is – Do not add fresh long near 1850. Book your profit on long deals and wait for the market reaction at 1850-1854. Think to buy above 1854.

Regards,             

Praveen Kumar

14 February 2014: Nifty Elliott wave analysis: Expect better opening backed by strong global cues. Question is can this gap up again sold? If yes then 5930 must be the levels to talk. Resistance – 6050.

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

For 14 February 2014: -

On 13 February 2014, FII Bought INR 399.40 crs and DII Sold INR 292.40 crs

Yesterday, it hit the high at 6094.40 and then crashed to hit a low at 5991.10 levels. This has ended the patterns of small trading ranges. I was suspecting this since opening minutes itself. It has again defined 6100 as decisive resistance for Nifty.

Now, we are going to get most important result today. More than charts and cues, it will be SBIN’s result which has bigger value. Poor result is expected and discounted. Can it be poorer than expected? If yes, then we will see washing out on banks.

Another important development for the day is that US market moved higher over 0.50%. Take this as 1% rise as when we closed futures were down by nearly 0.50%. Very obviously, it is going to drive us for some higher opening. We have already seen many stronger opening got sold many times this week.  

I am again expecting same. It will open higher and then resistance will emerge at 6030 to 6050 levels. If this sell off gets follow up then Nifty can break 5930 levels too very soon. Global cues are better but can it give us any meaningful support? May be not.

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Strategy for Nifty February future – SGX NIFTY is showing me 6024 levels. This must have added effect of 1% comparable rise in US market for us. This level might not sustain even till 9 am on SGX. Technical charts are saying for resistance @ 6030 to 6050 on Nifty February month future. Can it again slip in second half? If yes then we can see panic selling now. All depends on SBIN’s Result. Technical support is at 5980 and then only at 5930.  

S&P 500 (USA) – It took another sharp intraday rebound since opening. This kind of days has defined bulls at USA. Well, I am still retaining my view that US indices are about to see the end of this rally or recovery. Few closes below 1609, i.e. 50 DMA will give what I am planning for. At 1630, I can say that only technical resistance will emerge at 1850, rest all will be unexpected. I must say that one should avoid long and prefer to sit blank.

Regards,

13 February 2014: Nifty Elliott wave analysis: Nifty can see another day with resistance at 6100+ levels. Nifty is likely to slip towards 6000. Market looks tired in recovery now.

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

For 13 February 2014: -

On 12 February 2014, FII Bought INR 211.99 crs and DII Sold INR 261.96 crs

Firstly, Nifty is still feeling heavy near 6100 levels which is the most acting resistance in many rise we saw in past. Please refer to the given chart. Another important point is that small cap and mid cap indices were under performing yesterday. Broadly, this is not a good sign.

Yesterday evening economy data came. IIP came at (-) 0.60% which CPI came at two year’s low at 8.79%. This is little relief for market. Well, I can say that CPI is usually remains low in December to March months. It is positive to a limited extent.it may save us from initial dip.  

What is disturbing for this market is second half sell off. It is almost happening every day. Irrespective of opening it always tend to close near lowest point of the day. This kind of trading can turn to give the lower side breakdown any day and anytime.

It may try to test 6100 levels today also in opening minutes but it is not looking like to sustain. One must note that now global cues are not that supportive as past few days. Nifty will get support at 6050 levels. If it breaks then it can move towards next trading zone of 6030 to 6000 levels.

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Strategy for Nifty February future – I have quoted for the resistance at 6115. When it came to cross, it was not convincing me which I have updates on my intraday updates. Hence we went short. Now, if it comes at 6115 again then also my view will be same. This market can see tired move if try to rise. It does not matter how it open today. What matter most is how it can close today? Once again, a little higher opening and second half sell off is expected.

S&P 500 (USA) – we can see two important developments on S&P daily charts now. First is that yesterday’s high is just 78.60% of total fall. So top came at 1827, I strongly believe that it has topped out now. Secondly, it has formed a Doji pattern. I can still put my emphasis on 1809 support band. Once it breaks 1809 then we will see the occurrence of fresh wave of sell off. I can say that get out of all long and load yourself with shorts on US indices. Most probably, strongest bulls are close to change their mind now.

Regards,

Praveen Kumar

12 February 2014: Nifty Elliott wave analysis: I can still repeat that 6075-6095 is still challenging resistance. No matter what the global cues are Nifty has to first stand above 6095 to think about further gain. Support = 6030.

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

For 12 February 2014: -

On 11 February 2014, FII Sold INR 165.40 crs and DII Bought INR 242.37 crs

Nifty has high at 6082, low at 6053 and closed at 6062 for yesterday. It is itself saying how tougher the day was. Even high to low difference was not even 30 points. These kinds of day always leave an edge for confusion. There is no great buying support from FII side in cash market.  

When US market recovered nearly 70% of their fall, Indian market are struggling to recover even 38%. US market gained over 1.25% last night while some leading European indices recovered as big as 2%. Asian market is not that firm but still higher. Nothing can be better than this as global cue.  

Question is still same can Nifty able to stand tall above 6095 resistance mark? It has failed in past three days of trades. Major component of NIFTY is Reliance and that is under pressure due to some political heat. Threat is that Reliance can see a further dip of nearly 8-10% in coming days due to technical weakness. Just think, if we see Reliance trading below 800 levels which is very likely now.

From past two days higher gaps are filled with second half weakness. We may expect another round of test towards resistance due to strong global cues. I will act fresh long only if it can able to sustain above 6095 levels.

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Strategy for Nifty February future – I can still say that 6115 will act as decisive point for bulls and bear both. It is missing those technical levels from past three days. SGX NIFTY is giving just 20 points of higher opening. How many times we saw this failing at top? If this is coming after almost 200 points of rise in Dow Jones then it is really tough way. I am still avoiding call to short index as positional but not going long either. We can think to add and hold long only above 6115. There is no point to think about big fall either as long as it is above 6030 levels.

S&P 500 (USA) – I was assuming for a move towards 1809 and then decisive. All goes in favour of bulls and it came at 1819. What a rise! This is the reason that I am saying from past many months that US has strongest bulls of the world. You cannot get those in India. US market recovered nearly 70% of their fall which begun from 1850. Now when it is well above 50 DMA then we can conclude that it will stay above 50 DMA and 1809 will act as support. There should not be attempt to short as long as it holds 1809. Note, there is no sign of even a small pullback. If it has to come then also it can come only below 1809.   

Regards,

Praveen Kumar