04 August 2015: Nifty Elliott wave analysis: Expect a PoP-Up top in post policy hours. Equally, a rate cut is likely. Resistance – 8600-8650 !!!

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

For 04 August 2015: -

On 03 August 2015, FII Bought INR – 350.41 crs and DII Sold INR 33.36 crs

We saw a choppy session near 8600 resistance mark. So far this choppy session does not go in favour of anyone. Banking stocks are in lime light just before RBI policy. Well, there is no need to be contrarian trader. Let us assume that market will get desired rate cut. It may be by 25 basis points. Then also, it may face decisive hurdle at higher levels.

If we look up certain rate sensitive stocks, we can observe that those are rising since Nifty saved the support of 8300 levels. This rise is henceforth a weak rise as participation came from weaker stocks. Have a look up on all banking stocks. We saw more than 10% bounce from their recent low. It does not make so much great impact on Nifty yet.

For today’s trading session, I am expecting a silent to up opening with resistance at 8600 levels. In the down side we may have meaningful support only at 8480-8450 levels. Hence trading risk is higher at current levels. Do wait till the outcome of RBI monetary policy review. I am expecting a pop-up top today.

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Strategy for Nifty August future – Nifty future should take a dull to negative start. On higher side 8610+ levels are resistance. I am expecting resistance to emerge at higher levels. Depending on the policy announcement we may see some higher levels that’s also if it comes in favour. Possibility is to hit 8610-8640 then a dip.

S&P 500 (USA) – Just as past many months, it has moved above 2110 for small time to challenge 2135 but lost the steam. Now again breaking 2095 to create a moderate sell signal. If it closes below 2095 then it has bright chance of hitting the support of 2070 once again. It is still difficult to say if it can break 2045-2040 support levels. I still believe that S&P has great chance of breaking 2000 marks anytime.