02 June 2015: Nifty Elliott wave analysis: All eyes are on RBI’s monetary policy review. Market expectation - rate cut by 25 bps.

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

For 02 June 2015: -

On 01 June 2015, FII Bought INR – 113.47 crs and DII Bought INR 49.34 crs

We have monetary policy review today by RBI. Market has an expectation of 25 bps rate cut. I must say that inflation is not justifying any further rate cut but this rate cut may come to boost Modi dreams of reforms. Well, in my view it is not a good idea to decide rate cut on political basis.

Based on technical analysis Nifty has resistance in the zone of 8450 to 8500. Big question is will RBI able to provide trigger to break it on higher side. This is something which no one can answer precisely.  

For today’s trading session, I am expecting a flat to cautious start. After that we will see technical support in the zone of 8400 to 8380. I prefer to avoid trades till policy comes out. I still feel that Nifty may not find it easier to cross higher resistance levels. If it can do then we can expect levels of 8700.

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Strategy for Nifty June future – We exited our long at 8450 levels. Now, I am in wait and watch mode to deal fresh. One this is for sure that below 8400 we may have least scope to think for long. On higher side, I may give an attempt to short if I see resistance emerging in the zone of 8500-8520.

S&P 500 (USA) – I keep my analysis same in this kind of choppy close. Do not trade this index as of now. This is on expected tug-of-war situation. One day up next day down pattern is making indecisive to trade. The best way to trade is no trade on this index. I still intact on my view, that US index is on the making of long term top. So far, it has slipped from 2135 to 2105 levels. This is the level which S&P 500 is maintaining from November 2014 itself.