NIFTY weekly analysis for 22 September’14 to 26 September’14

Elliott wave theory: we already got one dip last week. Now, it is again on re-test of 8181. Unless it closes strongly above 8181, do not buy. I am expecting expiry here and there at 8000 levels.  

Market cycle: INDIA VIX is running near 11 for the first time in history. A top can emerge very sooner. I cannot deny the possibility of 8240 on a move above 8181.

Technical indicators: MACD and RSI are growing with negative divergence. This is alarming. This is prime reason that I am advising strong caution.

Charting pattern: I always listen this factor and try to gives higher weight-age as its only and only price which pays in market. Charts are saying that as long we are above 7860-8000, we are bound to see higher levels. Above 8180, it can see levels of 8240 before forming any final top. 

22 September 2014: Nifty Elliott wave analysis: We may see another bear gap down today. Failure to revive from 8080 or from 8050 will cause retest of 7925 levels sooner. Be cautious at higher levels as it is derivative expiry week.

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

For 22 September 2014: -

On 19 September 2014, FII Sold INR 6.53 crs and DII Bought INR 237.15 crs

Technical charts are not goes as expected for Friday’s trading session. It is just giving me a sense that buying has lacked to some extent on Friday’s session and it formed a DOJI on chart. If this goes right then we are on the track for another pullback. We are derivative expiry week too.

As of now, SGX Nifty is hinting for a negative start of 35-40 points. If this comes then it is a real big gap down. We will see immediate support at 8080 but it is sustain below 8080 then we see fresh troubles for Nifty. One need to note that derivative positions must be very wild due to last week fall and shoot up. Scope below 8080 will be just a dip towards 8000 levels.

For today’s trading session, opening will be very important. I had a plan to add long on dip but looking on market behaviour on Friday’s session, I have added index short again on higher levels. I just do not want to go in to the reasons of correction-fall or rise. Market phenomenon is suggesting that a pullback is likely. We have VIX hitting all-time low right now. 11.0125 for VIX is also a historical low.

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.

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Strategy for Nifty September future – Technical resistance range of 8160 to 8200 was zone of resistance. Technically it was giving a mild signal to short when it was in the zone of 8140 to 8150. We have technical support in the zone of 8080 to 8090 now. We may get those levels in the beginning minutes only. Failure to revive from 8080 will cause fresh pullback. Have a look what has happened in past one week – An unexpected dip, short covering rise and then a possible fall now.

S&P 500 (USA) – S&P has jumped over 2013 on Friday during intraday session but failed to sustain above that levels. Bulls are not weak yet but surely they picked a very wrong day to stop. Technical charts are suggesting that if they fail to take out 2013 in hurry then we may able to see one more pull back. Perhaps, 1990 will comes into play with the beginning of this weak. So, first support is 1990 and resistance is 2013 and 2019.