01 February 2018: Nifty Elliott wave analysis: B-Day is D-Day for stock market. Will budget go on populist note or reformative note?

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

Analysis 01 February 2018: -

On 31 January 2018: FII Net sold – 136.63 INR Crs:  DII Net Bought – INR – 1294.66 Crs

Ruling party is going to present its last union budget today. Market is sitting with a pre-budget rally with all time high at 11171 levels. This is definitely remarkable. I had a view after Assembly poll that if it can sustain above 11600 then it can raise more and it went up when I was on my personal task.

Now, has Indian market over done in rise? Well, this is 101% true and most market used to go ahead of reality before any significant correction. Based on Fibonacci series and support, I am not expecting any great correction as long as it is 10900 levels. We can expect roller coaster ride today.

My expectation with budget is that it is going to be populist budget which market may not have point to react positively. Whatever position has to come, market may have already discounted with pre-budget rally. I am not in no participation mode right now as I came after long vacation.

For today’s trading session, Nifty is likely to open optimistic note with no clear view. Then market will dance on Mr. Finance Minister’s words. This may invite trading range of 300 to 400 points. It can possible be 11200 to 10800 levels. Rise or fall, it is going to be a gamble to participate. I just like to be spectator.

Strategy for Nifty February future – I am back after a long vacation to start in post budget day. Well, I like to watch market outcome first. Based on Elliott wave count, we are on fifth wave extension and it’s historical, something which do not come so frequently. 10900-10800 is going to be decisive support for budget day.

BANK NIFTY February future – 27450, Well, this is the last close and this is definitely backed by the steps taken by government of India. Big question is, “are Banks really that much healthy for investment?” My answer is not affirmative. I will remain sceptical. If any sector has to be watched for Budget day then it must be Banks.