06 February 2014: Nifty Elliott wave analysis: If Nifty manages to stay above 6035 then one can expect for a move towards 6075 to 6095 as next immediate threshold. Hoping for more recovery.

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

For 06 February 2014: -

On 05 February 2014, FII Sold INR 576.20 crs and DII Bought INR 815.23 crs

FIIs have sold in cash market for fifth consecutive days. Do not worry about these figures as FIIs are known to do that. We saw two days in a row of small pullback from lower levels. Day before yesterday it hit a low at 5933 and yesterday it hit a low at 5962 before rebounding. Now on higher side crossover of 6035 levels give a rise towards 6075-6095 levels.

It has generated and redefined two technical supports. One comes at 5960 and other at 5930 levels. Global cues are almost neutral at this point of time. Those have not recovered like Indian market. I can still repeat that pullback will be impressive only if it can take out resistances of 6075 to 6095 levels. It is not going to be easy.

We need a bull’s gap up. A gap up which should not filled in intraday session. This gap up is still missing. I feel that as long as rupee is not giving any scary panic we should be safer on equity price. We picked stocks like Tata Steel and Tata Motors which worked quite well. Now it is the time to pick stocks like Infosys which was market leader in previous rise.

If I have to be worried then I am worried about banking stocks which are not giving signs of recovery yet.

Strategy for Nifty February future – Nifty February future is very likely to see a flat to positive start. So, it has again rebounded strongly from lower levels yesterday. Technical charts are suggesting for immediate resistance at 6060-6070 levels. If one has previous long then one can hold but fresh long should be taken only above 6060-6070 levels. Let us give some margin to the bulls to test their own strength. Technical support will come at 6020 levels.

S&P 500 (USA) – Yesterday’s low was at 1738 which was lower than Monday’s low with small margin. On charts it is still on lower low. I still feel that recovery should come and extend. As long as it holds the levels of 1738 we can expect a move towards 1768. Note that 1768 will be decisive for further move. Either it can take a move towards 1800 on the cross of 1768 or it can fain at 1768 to come at 1710. Let us see what is going to happen next.

Regards,

Praveen Kumar