28 January 2016: Nifty Elliott wave analysis: 7500 is a challenge so far. If breaks from near to 7500 then 100 points dip is possible for second half.

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

For 28 January 2016: -

On 27 January 2015: FII Net Sold – INR 366.93:  DII Net Bought – INR – 499.99

I have added yesterday that as long as it is above 7400 we can expect 7530 levels. Today is the most suitable say to hit 7500+ levels. Well, today is derivative expiry too. Technically, if it does not breaks 7500 then we can see selling from higher levels. Looking on current pattern we can say that if fall has to come then it will come in second half only.

For today’s trading session, we may get a higher opening but I prefer to trade long on dip only. My choice for second half will be shorting. If I have to short then I will after 1 pm only. if selling comes in second half today then it will be brutal. My expectation for expiry is below 7400.

Let me clear what weekly charts are saying. A full 1500 points of fall is possible from 7500 levels. I have no idea if it gives 100% result what it is showing on theory but the target lies near 6000. Sorry, if words hurts you but this is what I feel. I do not see Nifty going at 8000 anymore in easier way.

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.

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Strategy for Nifty January future – We have derivative expiry today and my view point is that if Nifty can sustain 7490 kind of levels then we can see a fresh addition of 50 points. Can it see fall in last hour again? Well, chances are here again. If it has to fall then it will fall by today also and that’s in second half. I do not see any threat for first half. Still, for second half we can see a fall of nearly 100 points.

S&P 500 (USA) – I cannot say that it was entirely unexpected. Keep news flow on one side and justify this move by technical charts. It can be seen that we saw a profit taking after 100 points rebound. I used to say that on long term chart first bounce is only a reaction not a reversal. It hit a high at 1915. Now to move up it has to stay above 1915. If it fails then it will break 1812 levels sooner or later.