08 January 2015: Nifty Elliott wave analysis: NIFTY to show strength above 100 DMA which is at 8132 levels. Yesterday’s low 8065 will be decisive support.

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

For 08 January 2015: -

On 07 January 2015, FII Sold INR 1570.76 crs and DII Bought INR 601.40 crs

It hit a low at 8065 before bounce. I cannot say that bounce was impressive yesterday. It was running with massive fear and every intraday attempt of recovery has sold. Still, improved global cues are giving hope for today’s trading session. Nifty has closed well below 100 DMA. This pattern is very similar to recovery like 17^th December 2014 when Nifty hit a low 7961. Even at that it has given one close below 100 DMA but then it has seen improvement.

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 start backed by rise in US market. It will be good if it takes out 100 DMA in gap up which is at 8132 levels now. The range of 8132 to 8150 may offer some resistance. Once it starts trading above 8150 then we can expect some good recovery. I am expecting recovery to go in the zone of 8250 to 8300 levels.

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 8170 ranges. Yesterday’s low of 8096 should be a medium term support. Now, I prefer to buy every dip with suitable and small stop loss. We can expect 2-3-4 days of rise now but it may not able to give 8400 levels again. We may expect fall after this recovery but right now, opt to buy for some bounce.

S&P 500 (USA) – I have quoted that 1990 will act as good support in dip. Finally, it saved and bounced to a great extent to give first impressive rise of 2015. This came when crude oil did nothing. Technically 1990 should remain a short term support. I expect more rise for few days. First immediate challenge will emerge at 2045 levels. Use any pull back to buy now.