07 January 2016: Nifty Elliott wave analysis: Chinese woes can cause another big gap down. Next support – 7650- Heavily oversold.
You must read previous articles and watch the given chart carefully to
understand this article completely.
For 07 January 2016: -
On 06 January 2015: FII Net Sold – INR 352.42: DII Net Bought – INR – 13.19
Relative performance is one thing which net down side is another thing.
Nifty has closed will fall for three days in a row and almost breaking every
possible intraday supports. Now once again Chinese worry can overshadow all
possibilities of relief rally. Chinese market is down by 7%. All global indices
are bleeding.
It looks like H&S pattern is taking its effect. Well, if H&S
pattern goes on its true mode then 7200-7100 is the possibility. Meantime Nifty
is over sold for short term and intraday chart. This says that market may
ignore MACD positive divergence and sooner or later it will hit 7200-7100
levels. After that 6500 will be the figure which people will talk about.
For today’s trading session, we may see a gap down as most global indices
or indices futures are down again. One
can expect this to take support around 7650 levels only. Do not buy unless a
strong buy emerges. There is no great chance of shorting index after 80-100
points of gap down. Do not trade.
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Strategy for Nifty January future – One can
expect another bleeding opening and no possibility to jump on trade on either
side. This says that market is on panic mode. Over sold hourly chart may drive
support at some levels which are not known yet. One thing is clear that Nifty
may not have chance to break 8000 easily sooner.
S&P 500 (USA) – It goes
on 1990 and now it is concerning. It is breaking regular trading pattern. Right
now US indices futures are down again by 1% on Chinese Woes. I can say one
thing that it is heavy oversold in short term and hence a relief rally is
expected. Will come from 1990 or will it come from 1960. Only time can answer
but definitely “a big warning” sign of on for long term trend. Warning is for
those who are still considering long term trend as up. I am not amongst those.
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