18 October 2016: Nifty Elliott wave analysis: 8500 worked as dot so far. Will it get respect today also?

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

For 18 October 2016: -

On 17 October 2016: FII Net Sold – INR 456.64 Crs:  DII Net Bought – INR – 235.57 Crs

I can still repeat that Nifty may not give up 8500 so easily. Hence, I exited my short position just near bottom which I had added intraday. Well, I can say it’s is just 50-50 deal for rise and fall. We cannot bet on recovery so far. It may come or it may not come.

If Nifty denies recovery then we can expect levels of 8420-8400 by this week itself. Just think, if Nifty not dragging levels wise? I have quoted for a possible fall when it was running near 8900. Yes, it is drifting lower. We can get time wise recovery which is part of market dynamics.

I retain with my target of 8200 on Nifty in coming few week. Right now, it is the time to hope for a rebound from levels of 8500 on Nifty. This rebound cannot be big enough to say for a strong buy. This may just sustain for 1-2 days.

For today’s trading session I am expecting market to open on positive note. Strong technical support will lie on 8500. As long as it holds 8500 and sustain do not prefer shorting from lower levels. It is equally true that if it breaks 8500 then we can expect quick 60-80 points of fall but that day may not be today.

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 October future – I have no forward position as of now. I will prefer to wait-watch and then trade. Technical support will be at 8500 just like yesterday. On higher side we can expect 8620 as a key resistance. Will recovery give a buy opportunity? I like to deal but I will not trade if range remains small.  

BANK NIFTY – Well, it came near to 18800 or 19000, to me things remains same. I do not prefer shorting from lower levels without a bounce. My levels for shorting will depends on magnitude of recovery if comes. I may not prefer to trade short today. It is my anticipation that recovery should come to give us levels of 19400.