07 October 2014: Nifty Elliott wave analysis: Nifty will open down after a long weekend. Below 7890, it can hit 7840 too. Do not buy dip in indices or in stocks. Global market may extend loss.

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

For 01 October 2014: -

On 01 October 2014, FII Sold INR 63.24 crs and DII Bought INR 155.69 crs

Welcome back after long weekend. Global market has done a lot of rise and fall in between. We will see gap down but it is not as bad as SGX Nifty did in past few trading sessions. At one time SGX Nifty was even below 7800 during holiday in our market. Well, from 7945, Nifty chart is going to extend its weakness.

I have quoted 7925 and 7850 as crucial level for last week of trade. I feel that 7925 will break in opening minutes only or may go in gap down. So, will it hit 7850-7840 support zone. Chances are there if weakness extends in global market. S&P and DAX are likely to extend loss and hence second half selling is expected.

For today’s trading session, based on chart, 7925 is again crucial. Break below 7925 should give us levels of 7890 and the test towards 7850 too. We may get levels of 7925 in initial minutes itself. We have some 7900 put form good levels which we hold overnight. On higher side 7990-8000 levels will offer stiff resistance. Cross above 8000 will give levels of 8030. Market will wait for earning season to kick off. Once again Infosys will come with its figure on 10^th October.

I am still saying same words. Spoiler for global market can be just one big factor – Currency market. Almost every currency of emerging market is again showing fear on chart against USD. What can be good for US market may not be good for emerging market. I am writing this paragraph from past many trading sessions. I am quoting above remark form past many days. Indian Rupee moved from 60.25 to 61.90 in past 20 days.

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Strategy for Nifty October future – SGX Nifty is giving a hint for downside opening of approximately 50-55 points. I have already added short in the last trading day at 7990. If opening comes in the range of 7920 to 7900, then I may prefer to take profit for once. I feel that sooner or later we may see break below 7900. I will add fresh short if it sustain below 7900 levels. We may see quick fall below 7900.

S&P 500 (USA) – When Indian market were on holiday, S&P hit a low near 1926 levels. We saw a rebound after fall. This rebound may not sustain. Technical structure is still showing weakness. It is too early to say but I feel that it may hit levels below 1900 very soon. Stiff technical resistance will be at 1970 to 1-75 levels. I still suggest stay short or add shorts on any rise.