Monday, 7 September 2015

07 September 2015: Nifty Elliott wave analysis: Time to see reaction on H&S pattern versus positive divergence on RSI. I want a recovery!!!

You must read previous articles and watch the given chart carefully to understand this article completely.
For 07 September 2015: -

On 06 September 2015, FII Sold INR – 1287.12 Crs and DII Bought INR 1128.70 Crs
Now H&S pattern is clearly visible on chart. Head is at 9119 and n-line is at 7940. Total length is 1179 points. Hence, target on down side can be 6761. Well, this is a long term target and hence I quoted for target at 6500 levels in past few weeks. This target can be expected in next few months. Usually, panic can cause more fall so target may be extended on lower side.
Above is the pattern analysis. Have a look at technical indicator like RSI. It is giving a positive divergence. It is suggesting that market may not fall towards 6500 immediately at one go. Usually, this is a sign of consolidation. Hopefully we can see some relief bounce but take a note that long term trade is down. Badly down.
For today’s trading session, we may see flat to negative opening. Closing on Friday’s session was lower than the previous low. This is a disturbing sign. As long as it is below 7665 it has every chance to hit 7600 or some lower levels.
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Strategy for Nifty September future – I expect a volatile week for trading. I do not suggest shorting the dip. Due to positive divergence on RSI I am expect recovery from lower levels. I am not yet on conclusion mode for trade. One thing is for sure that it needs to stand above 7700 to bet for any rise. Let us see.

S&P 500 (USA) – S&P took a dip from 1990+ to 1910. Is this enough? May not but for some time market may go in range. Consolidation is the part of trading activity. I cannot suggest shorting near 1900 levels just at one go. I expect some rise in the process of consolidation. Avoid shorting near 1900 levels. My preferred levels of shorts can be above 1950-1960 zones. 

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