07 April 2016: Nifty Elliott wave analysis: Do not get trap on any rise now. Sooner, a confirmation for fall will hit.

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

For 07 April 2016: -

On 06 April 2016: FII Net Sold – INR 493.56:  DII Net Sold – INR – 258.68

I have predicted for a top with rate cut. We got rate on Tuesday and we saw a dip. Right now market is on its 100 DMA support. Nifty has 100 DMA support at 7570 levels. Once it breaks 7570 we can see better confirmation of top.

Will market try to be optimistic on earning season? Yes, it seems that it may take optimistic call but it has higher chance to fail on rise. Recent top of 7778 may remain untested. I suggest making exit from whatever long one has on investment account.

For today’s session, we may see levels of 7630-7650 for opening but every rise will face resistance till 7670. If it surpass above 7670 then we may have a possibility of rise to make a double top. In any way, Nifty looks for a topping out pattern. Sooner or later a fall will begin.

A reader has suggested deleting the paragraph given below. I must say that these are long term charting view with warning sign and hence it deserves to be part of everyday article.

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 April future – I expect a higher opening backed by global cues but I am not too optimistic as of now. We may see levels of 7670-7700 on optimistic note but it is strongly advisable to avoid long on higher side. Wait for a sign of weakness to trade from higher levels. Note that above 77000, we may not have chance to short for intraday.  

BANK NIFTY – So, 16300 remains untested and we saw levels of 15600. Now, we may see some price recovery which may come as a gap up. If it breaks 15600 then a further dip towards 15300 is possible. I am expecting levels of 15300 sooner or later with resistance at 16300 hence my strategy is to capitalize rise for shorting and keeping stop loss above 16300.