You must read previous articles and watch the given chart
carefully to understand this article completely.
For 20 August 2014: -
On 19 August 2014, FII Bought INR 559.39 crs and DII Sold INR
263.37 crs
It was silent trading session yesterday with a hit on one my
mentioned levels. It was said yesterday that it may hit levels like
7920-7950-8000. We saw resistance at 7920. It was nothing but a trend line
resistance as marked in the given chart. Most noticeable thing is that we are
on eighth trading day from 7540 levels. It is one sided rise. Most promising
will be if we see a positive close today. If this occurs then we have a scope
to see rally till Friday and even 8000 levels will come till that time.
I must say that from now onwards it is compulsion to see
Nifty closing above 7920 then only we can see comfort. Dip from 7920 will not
good and favourable for market. In we have many reverse H&S pattern emerges
on many stock charts. This shows that even if pullback comes it will be bought
from lower levels. This kind of pattern has seen in many banking stocks.
For today’s session, we will see a silent opening. Immediate trading
support will emerge at 7880 and then at 7850. Big question now for traders it
that can we able to see trade above 7920 on eighth day of the rally. I need to
add word of caution for the day.
We are seeing participation in mid cap and small cap stocks
too which shows that market is in greedy mode now. If this is right then as per
time cycle we may get a short term top at 7920 or 7950 or 8000 at the max.
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Strategy for Nifty August
future – Nifty August
Future should open higher near 7900 levels. It did nothing great in last
trading session. Even for today’s trading session my condition remains same. If
we can spend time above 7920 -7925 then we can expect short covering rise
before forming a short term top. Trading support is at 7800. Exit from long if
it breaks 7880.
S&P 500 (USA) – As suggested in the road map,
S&P is heading towards 1990+ levels. I need to conclude one thing that this
tie it will not only test the psychological levels of 2000 but it may also head
for 2025-2040 levels which was many brokerages target of the year end. At some
point we need to be cautious. Out call ratio is showing the excessive people
trading for long now. 60 minutes chart has emerged with negative divergence. Before
hitting 2000 levels, we may expect a short term pullback. Do not jump on long
now. As of now, I am only saying, do not buy rise. Just wait for pullback. Book
if you have long at any point in the dip.
