29 January 2016: Nifty Elliott wave analysis: First day of the new derivative month. Expect resistance at 7500.

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

For 29 January 2016: -

On 28 January 2015: FII Net Sold – INR 961.82:  DII Net Bought – INR – 394.22

This is fairly a dull expiry and I was not anticipating this kind of silence on expiry day. It is still a notable point that Nifty has not crossed 7500 yet. Equally it is not below 7400 levels either. I still expect a move towards 7500 before downside. Well, this is just anticipation. Once it breaks 7400 then it will take out all possibility of 7500 levels.

For today’s trading session, we may get a flat opening but I prefer to trade short on bounce. 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 is if it goes below 7400 then dip can be sharp.

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 February future – Today is the first day of current month. Technically 7480-7490 is a turning out to be key resistance. On higher side crossover of 7490 may not be easy.  If it comes then only we can expect a 50-60 points move. Below 7400 it will be played by bears only.

S&P 500 (USA) – Market is expected to be in range for now. Technical charts are suggesting that trading range can be 1875 to 1915 for the time being. I am expecting another possible down move to start with a top somewhere near to 1915 levels itself. Whatever up side is coming may be the time for exit from tempted long. So far, not a great short signal.