13 October 2014: Stock Chart Analysis for intraday – TATAMOTORS, BHEL and DRREDDY

TATAMOTORS (492.70)
Buy above 498/ SL 495/ Target 505|| Sell below 488/ SL 493/ Target 480-475

TATASTEEL (448.05)
Buy above 454/SL 451/Target 458-460||Sell below 445/ SL 448/ Target 438-435

UNITECH (19.25)
Buy above XXXXXXXXXXXX||Sell /Medium to long term/ Target 16-14-9

13 October 2014: Nifty Elliott wave analysis: Once again, have an eye on 7800 levels. Break below 7800 will cause some panic sell off. Nifty may be heading towards 7600-7500.

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

For 13 October 2014: -

On 10 October 2014, FII Sold INR 719.77 crs and DII Bought INR 558.21 crs

Activities in global markets are favouring bears now. I have already said that we have a possibility of sell off in October month with end of QE program. So far, it goes right. We saw almost five bounce from the support area of 7850 to 7800 levels.

As shown in chart, we may see problem below 7800 levels. It is just about to break crucial moving average support. If it fails to revive from 7800 then a panic like situation is very likely. This situation arises due to large sell off in US market. Indian market has shown great resilience to save 7800 levels but odds are also too odd now.  

For today’s trading session, we may see opening on down side gap. If it can able to eat 7800 then we may see some rapid fall towards 7775 then towards 7700 levels. Hence, I am making this week as very crucial. In past few days we saw many gap up and gap down but nothing came below 7800 so far. Moving on higher side 7910 will act as stiff resistance. If opening goes below 7800 then 7840 will also act as stiff resistance for bulls.

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Strategy for Nifty October future – Nifty October future has support at 7850. If it takes out as gap down which is very likely then we may see selling intensify for 40-50 points more in the panic of long unwinding. Do we have a chance of trading after gap down? If gap down goes more than 1 % then one should opt to short in bounce only. Practically, 7850 – 7860 will act as resistance after opening.

S&P 500 (USA) – I have already quoted too many times about the possibility of fall towards 1905. Here it comes on Friday night. This is what I called as bull’s fear. I am expecting S&P to go as low as in the range of 1850 to 1800. Remember, it happened in past every times when QE ended. I am feeling that it is just repeating its pattern. With this blow it can end the possibility of quick recovery. Hence, I do not prefer to buy the dip for any quick gain except a small technical recovery but that’s also far from now. 

NIFTY weekly analysis for 13 October’14 to 17 October’14

Elliott wave theory: It has just closed near to 7850 levels. This is making charts concerning now. In fact, it was concerning at higher levels itself. It seems that we will start getting few closes below 7850 levels. If this happens then we can hope for a down side towards 7600-7500 levels sooner in few weeks.

Market cycle: Nifty is almost away by five weeks from its all-time high and practically it is heading for two month’s lowest levels. If you remember, Wolfe wave truncation has happened at this level itself. So it may take its effect anytime now.

Technical indicators: MACD and RSI are growing with negative divergence. This is alarming. This is prime reason that I am advising strong caution. This indication is running from past more than four weeks.

Charting pattern: I can still say that below 7850 on closing basis, Nifty should see a fall towards 7500-7600 levels. This may be due wide difference between moving average support. Reason of price fall can be anything.