02 February 2016: Nifty Elliott wave analysis: 7610 is still a decisive resistance and support exists at 7500 levels.

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

For 02 February 2016: -

On 01 February 2015: FII Net Bought – INR 253.88:  DII Net Sold – INR – 535.70

I was expecting a pause at 7610 levels and it has shown the pause near same level for first day of the month. I am still not saying that it can be a final top before fresh sell off. Just one red candle is not a sell. Based on support we can conclude that so far market is up as long as it holds 7500 levels. I still have warning for 7610. Failure at 7610 is not good. Market may make another attempt to break higher.

For today’s trading session, we may get a flat opening but market is not looking to give good trading range. Do not trade if range limits in 20 points. I still believe that market will short respect for 7530-7500 as support zone. Once again, if it turns weak at 7610 then it is a sell.

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 – I repeat, no signal can be strong for short unless it go below 7500. Problem is that market is almost 1% higher compared to meaningful support. I believe that market is looking for support at 7530-7500 levels but with equal magnitude it will face resistance at 7610. Shall we short on rise? I am sure that most contrarian trader will be active at 7600+.

S&P 500 (USA) – Us market may undergo in the mode of consolidation and it is up as long as it is above 1915. Decisive cross over is expected to be above 1945 levels only. The range of 1915 to 1945 will give limited trading opportunity. I favour buy as long as it holds 1915. It has chance of hitting lower again if it breaks and sustain below 1915 levels.