You must read previous articles and watch the given chart
carefully to understand this article completely.
For 29 May 2014: -
On 28 May 2014, FII Sold INR 286.54 crs and DII Sold INR 33.40
crs
We saw another dull day in the last trading session. We have
derivative expiry today. Current pattern on daily to hourly charts are not very
encouraging for bulls. Nifty has first support at 7300 but the break of 7300
will give us levels near 7260. You can see that conclude is almost same as
yesterday.
According to Elliott wave theory on hourly chart, Nifty is in
trending wave ‘C’ which is a part of corrective full wave. So we are in wave
‘C’ from 7504 and we have already travelled a distance of nearly 200 points.
Logically end point of wave ‘A’ need to be broken. End point of wave ‘A’ is at
7130. This is prime reason that I try to be reserve from buying on rise
although stock specific moves are coming to catch for good.
I still like to issue warning from buying mid cap and small
cap stocks as those are just forming trap. We have derivative expiry today and
it will be interesting to see the moves on some stock which moved rapidly over
past few trading sessions. If this is going to be even short term top then also
it can hurt investors very badly.
For today’s trading technical support will be at 7300 and
then at 7260 levels. If it stays below 7325 then we can expect the re-test of
yesterday’s low near 7260. On higher side, it will face resistance at 7400+
levels. I just believe on thing – sell the rise and sell the weakness.
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Strategy for Nifty June
future – It has key
support at 7300 levels which is still 50 points away. On higher side, Nifty June
future will face resistance at 7360-7380 levels. I will be comfortable in
shorting below 7280. Till that time, it will be speculative short call on rise.
Note that we have derivative expiry today hence be cautious. We may see some
trimming premium on future value of stocks and indices.
S&P 500 (USA) – A day after a new all-time high was
not so encouraging. It spends the day on dull note but closed lower. I still
believe that this top should not be bought. We are in last two days of May
month. This is going to decide the fate of US market for June month. Chances
are very high that we will see something going in favour of bears by tonight or
tomorrow night. I want to see the break of 1900 first.
