19 September 2016: Nifty Elliott wave analysis: My expectation is for the test of 8600 for once before expiry.

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

For 19 September 2016: -

On 16 September 2016: FII Net Bought – INR 660.59 Crs:  DII Net Sold – INR – 213.13 Crs

Friday was interesting trading session. It has followed the read map as suggested. We saw a high just above 8840 and then slipped to hit 8750 levels. Once it breaks 8750 we can expect rapid dip. Technically, this market is just not too weak to claim for another aggressive short. I posted the chart which is showing for the exact required gap fill. What should be next? I am feeling for a major fall on some day this week.

For today’s trading session I am expecting market to open in the flat note near 8780 and then we can expect immediate support at 8750. Real big trade on short side will emerge once it breaks below 8750 and sustain. We have ten trading sessions before expiry and my expectation is a test of 8600 for once. Can we get this? If yes then also it may not be that easy.

Do not misinterpret. I gave a long term trend as down from more than a year back. Nifty hit 9119 and then I issued for a long term top. Nifty hits a low at 6825 on Budget day this year. After such down side, wave theory had suggested for comparable recovery with three big possibilities for retrenchments, first to come at 50% at 8000, 61.80% at 8250 and 76.40% at 8575.

101%, I retain my view for long term trend down but that does not says that we cannot interprets for short to medium term of recovery. This recovery was bound to come and it is coming to make a wave [B]. Now, just imagine the magnitude of wave [C]. Higher the retrenchment, bigger fall will hit in future. If this wave [B] tries to end up near 9000 then 9119 may not be visible for many years. So, where is my long term target on Nifty? Well, it is in the zone of 6000-5500.

Strategy for Nifty September future – We have added 8800 put opting near to most perfect levels in the zone of 60-55. I have not touched Nifty future yet for trade. If this favours the trading situation then I will prefer to trade short on any kind of rise. Market may slip over 2% at least this week. Technical charts has developed structure which is not favouring bulls at all.         

BANK NIFTY – I need to repeat that 20200 is most stiff resistance which gas failed in rise on Friday too. Technically, I am still hoping for market to hit levels of 19500 sooner or later. I am advising strong caution on this sectoral index. One can use higher levels plus weakness to add short for this week too. As I said earlier that if market is preparing for long term top again then we may have every chance to see steep fall this week, A decisive one.