26 April 2016: Nifty Elliott wave analysis: Close below 200 DMA but it is still saving support of 7800. Higher chance of selling.

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

For 26 April 2016: -

On 25 April 2016: FII Net Bought – INR 222.34 Crs:  DII Net Sold – INR – 747.95 Crs

We are just near to derivative expiry. Beginning of this month, I have predicted for a top to come with two events. It could be either with rate cut or it could be with quarterly earnings. I am getting a feeling that top may have done for the short term. Well, I still need two more days to judge this properly. Here is the condition for top. NIFTY should never cross 7980 and then it has to close for two days below 7800. Can it happen? Yes, it can.

We have already seen close below 7870 but it I just first close. One thing is for sure that this market will not give up so easily and hence trade will not be unidirectional at any cost. Typical pullbacks are bound to come at these levels. Let it come.

For today’s session, opening may go soft but optimism will still grow. I am not saying anything about the impact of this optimism. I just have a warning – do not buy on rise or fall. If one has bought stocks in fall, prefer to give us. Intraday support is at 7800 for Nifty. Read more for Bank Nifty in this article itself in last paragraph.

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 – Today, I will take a fresh short on May month future. I will pick my own time. So today is the last day for April month analysis. April month future will get support at 7830-7820 levels but these supports may not work. Only selling will intensify with the breaks of these levels. 7800 is a key. Below 7800 we can expect panic sell off.

BANK NIFTY – I said yesterday to note a point of 16750. This is nothing but 200 DMA and hence market will not find it easier to break on higher side. As long as it is failing at 16750, just short this and keep stop loss above 16800 levels. If I am right then I see a possibility of 16400-16300 very sooner. Some technical facts are indicating that above 16800 we may have reasons to believe for 17000.