18 August 2014: Nifty Elliott wave analysis: Today will be bearish day if it fails to fills the morning gap down. Crucial resistance will be 7800 and 7840. Trading support = 7760 !!!

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

For 18 August 2014: -

On 14 August 2014, FII Bought INR 625.18 crs and DII Bought INR 135.75 crs

Indian market went higher in the last week of trade on the hope of some block buster announcement on Independence Day by prime minister. We got an energetic populist speech by prime minster but it has those key missing which market would have wanted. In fact, I can say that Indian market were very unfair in their expectations. It may lead some cooling off activity today in opening minutes.

Technical charts are again showing sluggish behaviour near 7800 levels which it has done three times in past. If I have an option to buy from 7800 then I would just prefer to wait for the market to take out 7840 resistance levels.

For today’s session, if it fails to fill its gap down then it will be bearish for the day. Technical resistance will come in the zone of 7800 to 7840 levels and it cannot be easy to long this zone. So, I am concluding that trading move depends on gap down. Do not keep hope from this week. Traders must and must avoid mid cap stocks from any kind of buying, stock picking, catching falling knife or value buying. If Nifty breaks 7750 then we can see this market sliding again.

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Strategy for Nifty August future – Nifty August Future may open negative near 7780. Suppose if it breaks 7765 then we can see fall. Well, 7765 is a good technical support too. One can think to short only if it breaks 7765 levels. If not, then it can bounce too. On higher side it will have resistance at 7810 levels. Final crossover of 7810 may add further up move towards 7850 levels too but this situation is not likely to come at least in first half.  

S&P 500 (USA) – S&P is still in the striking distance form 1956-1958 levels. It is likely to see that every dip will be bought be bulls.  Technically, we can still expect this move to go higher from current levels too. So far, we have not seen any sign of weakness yet. Now, a well-defined resistance of 1945 will act as good trading support. As long as it holds above 1945 we can expect move grinding higher only. Will it test 1975 again? Yes, it can.