02 July 2014: Nifty Elliott wave analysis: After gap up, 7700 Nifty will be most crucial and critical. Just wait for cross above 7700 to add fresh long. If NOT then it may be a trap!!!!

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

For 02 July 2014: -

On 01 July 2014, FII Bought INR 856.35 crs and DII Sold INR 774.66 crs

Refer to the Elliott wave marking given in the chart. There is a marked point ‘b’ which is at 7663. This is called technical trigger point. Now, we saw good rise in US market last night and so we will see a gap up.

Keep your eye at 7663. Cross above 7663 will shoot up to give a level of 7700!!! Wave theory suggests that we may see 7700 at the max to form "B". Cross above 7700 will violate corrective wave formation and it will begin a new wave!!! What’s coming? It will be clear today.

Suppose, if it takes 7763 in gap up then we will see quick fire up move in first hour itself to hit levels near 7700. Then, it will be decisive. Elliott wave is strongly suggesting that this rally may not extend above 7700. I must say that unless we see some top formation we should not try to sail against trend. If it violates and cross above 7700 then rise can be very sharp and very massive. I must say that RSI is on big negative divergence so crossover of 7700 is not looking easy.

While concluding with technical indicators and Elliott wave, I must say that it is only “PRICE” which pays in stock market and it is always my prime focus. The “PRICE” is up and rising. So, basic thing, “PRICE” is up and primary up trend has established so price is likely to be up.

Unless we see some reversal pattern, we should not opt to trade short. 101%, whatever is going to happen will happen by today and today only? There is no question of tomorrow. What can come above 7700? If happens, then prepare for 7800-7900-8000 levels.  

NEAR TO 7700 MARKS, JUST SIT ON SIDELINE AND WATCH FIRST. CHANCES ARE HIGH FOR BULLS TRAP NEAR 7700.

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Strategy for Nifty July future – Nifty July future will open well above 7700 levels. I will not trade after that for intraday as RSI 14 has big divergence on daily chart we well as hourly chart. I have explained well enough why not to trade. My all focus will be “ 7 7 0 0 “ levels on NIFTY spot only.

S&P 500 (USA) – finally, it entered in the zone of 1970-1980. This is supposed to be expected move once it went above 1956. A top can emerge at 1980 in technical term but at 2000 in psychological term. So far, as long as it is above 1956, we can expect higher levels to come. Euphoria based rise can give us levels at 2000. Remember, 16000 is also a knocking door for DJIA. It has just missed yesterday. We have already entered in second half of the year 2014.