21 January 2013: Nifty Elliott wave analysis: Nifty make another dot hit on well informed resistance at 6084. Only the cross over of 6084 will give us 6100 to 6126. Expect support at 6024, we might be running near top.

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

Today’s outlook: -

On 16 January 2013, FII bought INR 1169.65 crs and DII sold INR 961.67 crs.

Nifty hit my informed resistance at 6084. We got Reliance result after market which is impressive enough to open with 5% gap up. Somehow it may not able to give much impact on indices. Technical charts are suggesting that trend it still up with sluggishness. Immediate trading support will emerge at 6024 in any intraday fall.

I still believe that we may move higher towards 6100 or 6126 but these might be for top. I am not trying to put a nail on top as it is a dangerous task. I have already said this in past also that as long as we are above 20 days exponential moving average we are safe for short term. As of Friday’s close 20 EMA is at 5974 levels.

One can refer to my weekly wave analysis of Nifty to understand the VIX. It has closed in green on a week where market was rising. This is definitely not a good sign for market. I am unable to conclude the time frame but it can make its impact very soon, in a week or two that depends on market mood.

One need to note that now mid cap and small cap indices are underperforming Nifty.

If you look at the hourly chart, we can experience the intraday toughness. Where are the days when we were getting trading movement of 40-40 points in a day? Practical trading range need to improve but it is still narrow from month of December 2012 itself.

For today, I have a hope from Reliance whose GDR has gained over 5% in Landon Stock Exchange.

Strategy for Nifty January future: It came near too 6096 but unable to cross. It may try to move another attempt. Failure of 6-96 to 6100 will give another intraday dip of 20-25 points. This might be the impact of Reliance. As long as it is above 6050 for intraday basis, there can be the possibility of bounce back. Break below 6050 will drag it towards 6018 to 6000 marks. Nothing is impossible. Successful cross over of 6100 can invite short covering but those depend on extent of rise on Reliance only.           

S&P 500 – It has some high at 2007. VIX is running below those 2007 levels. When investors turn so fearless, I start fearing. I am expecting the dip to come very soon and my first logical target is at 1445. I do not know the reason of fall. I am already saying that anything above 1475 is for short and short only. Till now, I am wrong and it seems that I have initiated short in hurry but I am firm on my decision. Definitely I am not trying to be over confident as there are genuine sign for fall..  

Regards,

Praveen Kumar

18 January 2013: Nifty Elliott wave analysis: Market need to feed with good new to move higher. Partial deregulation of diesel price was one such news. Cross over of 6068 will give 6084-6100.

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

Today’s outlook: -

On 16 January 2013, FII bought INR 564.20 crs and DII sold INR 578.19 crs.

It was another set of reform where government of India has announced ‘partial deregulation’ diesel price. Bulk buyers will not get any subsidy on diesel price from today onwards. This news makes the market from to exciting. It was good news but it brings a bad news too. There is a fear of rise in inflation. So where oil companies were on fire, banking stocks were on fall.   

Indian indices are not as strong as rest other Asian indices in spite of reforms announcement, hourly technical chart is suggesting for a strong opening and stable first half. It is giving me a hint that it will see a second half selling or profit taking from higher levels. This level can be at 6068 or 6084. In a extreme case it can be 6100 too.

On daily chart we have ‘negative divergence’ on MACD which is still continuing. There is a upward channel which has saved the lower band of upward channel every times in recent days. I am still saying that this market is running near to short term top but top might not have formed yet. I am not in hurry to conclude anything as top yet.

I have highlighted 20 days exponential moving average as decisive support. Now it is at 5965, which is still looking too far for today’s trade. Until we start closing below 20 EMA for 2-3 days, we cannot say that this market can see remarkable profit taking. One should watch the mid cap stocks and indices carefully as those has started a phase of under performance.

Do remember, “Correction will come the day when least number of people will expect about it.”

Strategy for Nifty January future: It is loosing premium with rise in index. We have started month with premium of 60+ points but not it is only 12-13 points, so almost a percent has lost in premium. Technical charts are saying that we may not be near to recent high of 6096 levels. It may open near to 6070 and then may try to attempt towards 6096 but may not cross. In the second half, we can see tradable moves. Short in post 2 pm trade with a stop loss above days high till that time.           

S&P 500 – It was tired near 1475 but yesterday it has crossed ad close above 1480. is it changing anything much. No, I have already said that it may move towards 1500 but use all such rise for short and short. I do not know what will come to top this rally but something will come. We have seen almost 10% rise from recent low of 1345.

Regards,

Praveen Kumar

17 January 2013: Nifty Elliott wave analysis: In a topping formation, it can give characteristic fall from each possible top. Nifty looking to hit 5940 in coming few days after a higher start.

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

Today’s outlook: -

On 16 January 2013, FII bought INR 1029.50 crs and DII sold INR 691.76 crs.

FII money flow is really massive and DII kept on selling. There is great change in money flow it is still stable and positive.

Yesterday, we have seen some sharp dip from higher levels on global cues. Global cues were not as bad as market were thinking. It has reacted with higher intensity. We need to understand that even bulls are not very confident above 6000 of nifty. I am already saying from past two weeks that market is not giving stable rise above 6000. We have seen rise on technology stocks and then telecom stocks to make an attempt to add strength above 6000.  

Technical charts are already showing signs of sluggishness but yet not turning concerning. In past few days, it has generated this kind of patterns multiple times but never given anything greatly concerning.

I need to say that traders must watch 20 days exponential moving average. It is coming closer to 5957 levels. So if Nifty close below 5957 this time then I can say that it is concerning. It is still too far to talk about. Technical indicators like MACD and RSI is not looking stable on daily chart for 1-2days of movement.

I am feeling that Indian corporate earning is so far good but many stocks price are much higher. After Infosys people may try to focus on Reliance earning numbers where traders are assuming for a positive surprise on refinery margin.

There will two important expectations to dominate the trend. One is up coming monetary policy review and the next is budget expectation. You can expect from RBI monetary policy review but do not expect great things for economy from budget. Whatever has to come it will come earlier than budget.

Conclusion Nifty: It has broken 6024-6018 marks and slipped 26 points in no time. Closing at 6002 is not considered as stable close although it is not concerning yet. I am constantly saying that is giving signs of topping formation. Who knows it might be 6068 which can remain short term top. Two points for today’s trade. One is at 5980 and the next is 5957. You must look the hourly chart which was refreshed for today. It was a great fifth wave and then fall to give wave ‘a’. A minor upward wave ‘b’ will come but then we will see a fall again.          

S&P 500 – I said, “Short on every rise. We may see 1500 also but all those levels will be for SHORT & SHORT only.” Till now it is turning shy at 1475 levels. I cannot say when it will see a dip but many momentum indicators are turning sluggish. It is a zone where one needs to spread short. Correction will technical in nature. Nothing great is happening in US market from past few days.

Praveen Kumar

16 January 2013: Nifty Elliott wave analysis: More steam left on Nifty and it may try to achieve the levels of 6084 or higher. Immediate trading support will be at 6024. It is topping formation but not a exact top yet.

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

Today’s outlook: -

On 15 January 2013, FII bought INR 1077.55 crs and DII sold INR 755.84 crs.

FII can put as much money as much they want and it is looking endless right now. Nifty is breaking every single technical barrier with ease. We are near to the top but not on top yet. One must note that in a market which kept on hitting newer high, it is not possible to say that any particular levels will be a top or will form a top.

We will have immediate trading support at 6024 levels. We need to see some formation to develop at higher levels to bet for any remarkable weakness. As of now I can say that 20 days exponential moving average is one such level. It is still below 6000 marks of Nifty.

Practical trading suggests that we need to rely more on charting formation than moving average cross over or break down. Many technical indicators have entered in over bought zone. Many global markets are trading on mutli-month high.  

My prime reason to be susceptive is divergence formation on few important technical indicators. We may not see decisive fall now but things are not even looking good for buy. A technical chart has a structure which is suggesting for 6080-6084 as target on the cross above 6042.

I need to say that cross over will generate the target of 6126 on Nifty spot. We have seen some silence to profit taking in European market. I am expecting profit taking to come in Asian indices today. Can I say same thing for Nifty? Opps !!! No, not yet. Market is still assuming that we will get a rate cut in this month. “Optimism” is a key driver above 6000 of Nifty. The person who is going to take a decision is still silent. Corporate earning is looking good so far but many stocks has already seen very sharp rise in past three months.

Conclusion Nifty: We can conclude that up trend will continue and Nifty may try to move towards 6084 levels. It will have trading support at 6024.Wecan expect profit taking only if it sustain below 6024 for 5-10 minutes. Do note that nifty future will give lots of trouble due to heavy fluctuation in premium. I am taking a key that I will buy only a positive market. I will not prefer to conclude for buy in dip kind of strategy from higher levels.        

S&P 500 – I said, “Short on every rise. We may see 1500 also but all those levels will be for SHORT & SHORT only.” Till now it is turning shy at 1475 levels. I cannot say when it will see a dip but many momentum indicators are turning sluggish. It is a zone where one needs to spread short. Correction will be technical in nature. There are few concerns over debt ceiling but those has no great impact yet.

Regards,

Praveen Kumar