07 January 2015: Nifty Elliott wave analysis: NIFTY has broken 50 DMA and 100 DMA. Below 8120, it can extend fall towards 8050-8040 levels. Support to emerge at low?
You must read previous articles and watch the given chart
carefully to understand this article completely.
For 07 January 2015: -
On 06 January 2015, FII Sold INR 1570.76 crs and DII Bought
INR 1189.65 crs
How many times we saw 50 DMA and 100 DMA breaking on same
trading session? I do not remember when this happened last time. Well, global
market has fear of slowdown on sluggish crude oil demand. Yesterday’s fall was
seventh biggest fall of history in Indian market. So, has it confirm slowdown? I
must add that global market used to take sign of slow down only and only from
corporate earnings. Fall in crude oil price is a signal but not a confirmation.
I am repeating this from past few days. I must say that current chart has similarity
from December 2007 and January 2008. This is my reason of caution. It is just a
caution, not a signal to trade. I still believe for one more up move but there
is no need to do unnecessary adventure. Based on Elliott wave theory we are in
corrective up wave ‘c’ which will also be divided in three waves as shown in
given chart. It has fulfilled the condition of top of wave ‘c’ in wave (b)
itself.
For today’s session, I am expecting a positive to negative
start due to extended sell off in US market future. It may see a start near 8100.
This is really challenging. Below 100 DMA, I cannot suggest that we can have
hope. If this sustain below 8120, we may see levels near 8050 to 8040. Now, I
am going to watch for follow up money. For bulls, wait for positive green
colour to emerge on Index.
Take a note that only crude is not the only fear of market.
Ghost of Greece is also back in euro zone.
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Strategy for Nifty January
future – SGX Nifty is
giving me a hint for opening at 8100 ranges. It is more than 300 points down. It
is not easy to conclude now. Technical supports come at 8100 and 8050 levels. Let
us see where it open and where it take support. I am not on trade forward but
willing to see support. Is this a first signal of moves like January 2008?
Today is the last day of hope. If bears get a follow up then it will raise many
tough days.
S&P 500 (USA) – Fear comes true and S&P hit
another low at 1992 before some bounce at close. Equally crude oil also extend
some fall. It is just not possible to explain the reason of fall from $120 to $
below 50 for crude oil. Just one big question – is slow down coming? If fall in
crude oil price is not artificial then surely something big is coming for
global economy. Technical support for S&P is at 1990 levels. I will not
pick trade on it as of now.
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