14 October 2014: Nifty Elliott wave analysis: Recovery from ~ 38.20% support can give Nifty a push towards 7940+ levels. Technical support will come at 7850-7860. DLF – just never invest in this stock anymore.

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

For 14 October 2014: -

On 13 October 2014, FII Sold INR 671.06 crs and DII Bought INR 566.83 crs

Yesterday we opted to buy Nifty future at 7835 and planned to hold. It was just a test of support at 7800 which has shown based on trend line in the chart. In the wave pattern also we are almost at 38% of wave of 5. Exact dot point is at 7774. We are in constant three wave dip on Elliott wave chart. It just mean for one rise between two falls.

Now, above 7850-7860, we can expect some levels in the range of 7925 to 7940 at least. Real test and real challenge will come at 7980. Trend remains three waves (a-b-c) down as long as it is staying below 7980 but I took long on support. I will just not prefer to buy the rise.

There is no great effect of global weakness. I bought relative strength in Indian market.

For today’s trading session, we may see opening on upside. Immediate technical resistance can emerge at 7910 and then at 7945 based on technical analysis. Technical support will come at 7860-7850 levels. Take a note that practically it has never sustained below 7800 levels. If index is a buy then it never mean that I can buy midcap or small cap index too. Keep your eye on DLF too. I strongly criticize SEBI for their incomplete and extremely delayed action on DLF promoters. Give me a single reason for why have they exempted promoters from financial penalty. Do not give me logic that it could have hurt retails investors more. Where were these watch-dog when we saw HFCL meltdown multi year ago. I am expecting series of law suits coming ahead on DLF. Sooner, it will just be a smaller name in their domain. I will update a wave chart study on DLF on this weekend. Never-never and never buy DLF now in any dip or rise, strength or weakness.

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Strategy for Nifty October future – Nifty October future may take some positive opening. As long as it is staying above 7890 I am expecting levels of 7950-7960 levels at least. I am not denying the possibility of 8000 either. Do not short unless it go below 7890 or show weakness at higher levels. As we have forwarded long so I will look for suitable levels for exit to be on side line.

S&P 500 (USA) – In just four weeks it goes at five months low. It took a move towards my expected 1850 levels. It has closed at 1874 in last trading session with single day loss of 1.65%. It is the end of QE effect in October months. Well, shorting from 2000 to 1875 is sufficient enough. Now, mild technical recovery is expected. I will not prefer shorting without technical recovery. Someway an somehow we will see 1800 levels too sooner or later. Bounce can go at least in the range of 1890-1900 levels