09 May 2016: Nifty Elliott wave analysis: 50 DMA support working at 7670. As long as it holds 7670 expect 7850 by first half the week.

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

For 09 May 2016: -

On 06 May 2016: FII Net Bought – INR 27.71 Crs:  DII Net Bought – INR – 179.80 Crs

A price correction may have seen the beginning from 7670. A simple reason is 50 DMA. A technical price recovery is expected and it deserves. What can be magnitude of recovery? Well, I do not want to speculate the levels as we need to see a good confirmation. If things go in favour of bulls then 7850 may be visible in first of this week. I still say that down side has yet to come after a day or two of recovery.

My key expectation is – NIFTY can HIT 7400 by MAY month series and hence I am holding my shorts. Worse possible target can be 7200 too.

For today’s session, market may take a positive kick start for the week. Immediate support comes at 7700-7670 levels. As long as it holds 7670 do not opt shorting. We may expect a recovery. Let us see how long can it recover. I may opt trading long only for the day.

I hope it gave you the value of following paragraph which remains the part of my daily analysis.

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 May future – I am off to my short deals as 50 DMA was so close. I may take temporary long trade against the counter trend as recovery may continue for two to three days. I am equally firm that market may again fall in second half of the week. As long as it holds 7720-7700, do not opt fresh shorting.

BANK NIFTY – I have already said for 16200 and it has done. After a slide of 800 points, a technical recovery is expected. If things go the way I am expecting I may expect levels of 16700-16750. Remember, do not short now unless this index goes below 16100 which is beyond my expectation as of now.