04 January 2016: Nifty Elliott wave analysis: Gap down to come with disappointing global cues. Support at 7900-7880.

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

For 04 January 2016: -

On 01 January 2015: FII Net Bought – INR 228.11:  DII Net Sold – INR – 81.24

First trading day goes well for Indian market when global markets were closed. Today morning global cues look disappointing as majority of global indices are red or futures are big red. This drives weakness for Indian market future. Nifty were very close to 7980 on Friday’s session. I am expecting 8000 for this week even from lower levels. Technical support must be at 7900-7880. Take a note that 100 DMA comes at 7980 and hence it’s decisive to see crossover.

One must look on positive divergence on MACD. It is really a huge one and can be capable to nullify the effect of H&S pattern which has emerged on long term chart. If this goes right then we should buy every dip. It’s too early to conclude hence it is just a view so far.

For today’s trading session, we may see a gap down opening as a hangover of fall in global indices future. I am expecting support at 7900-7880 after gap down. It can be followed with a recovery. If recovery comes then chances for 8000 will be bright for this week. If not then time can be concerning.

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Strategy for Nifty January future – We got expected bounce on Friday but opening may be too bad from Friday’s closing levels. I like to see the magnitude of weakness in opening hours before concluding for trade. Below 7900, we may not have great chance to see revival. If it has to bounce then it has to sustain above 7900.

S&P 500 (USA) – As planned earlier, I am taking this fall as an opportunity to trade on long side with a stop loss at 2030. I still believe that first half of first month is going to be bullish for US market too. As of now charts are justifying for a move towards 2080 to 2100. Use any dip to add long. Buy signal is either near 2045 or may be from 2000 too. Let us see.