Near Term Trend: ↑UP
Market update: Nifty Opened sharply up at 10780 levels and kept moving higher and higher and closed almost at the highest point of day at 11170 levels up 135 points.
Now since Nifty has crossed previous high with so much momentum and force, we have changed the near term to up. However please keep in mind that overall this leg remains a corrective rise and though it might stretch for a bit, it can finish suddenly without warning so inspite of markets breaking above previous highs, no fresh longs are advised at cmp.
We had mentioned yesterday Nifty needs to break below 10780 levels in next two days to confirm start of a new leg on the downside. Markets on the other hand have made a new high today.Todays high assumes lots of significance as 11171 was the previous high for Nifty ( before it was taken out and Nifty posted a new of 11750).
Inspite of the fact that markets made a new high today,there are many things which doesnot seem right at this stage. For starters there are plenty of negative divergences to be seen all around, secondly the volumes seems to be missing also todays rise seems to be news based ( opinion polls predicting BJP win) and lastly markets have turned overbought now.
It might be possible that this is part of pre election rally and Nifty sees higher levels from here and its also possible that its a false breakout ( in which case it should reverse soon).
Technically speaking, this pull back from lows of 10600 remains a ABC pull back but instead of flat its turning out to be zig-zag move.
Another important thing to note is that the fall from 11750 to 10K levels had taken 38 days and now mkts have already consumed around 92 days ( which is almost 250% of total time) and is still sitting below that high (infact its barely retraced 61.8% of previous fall). Now as per rules of Elliott wave/Neo wave, the corrective leg can consume upto 300% of time ( but those are rare) usually markets consumes 150-161.8% to 250-261.8% of previous move.
250% gives us 95 days & 261.8% gives us 99 days. We have consumed 92-93 days already hence a note of caution, these strong rallies we are seeing are coming too late and next few trading sessions could be really crucial. Having said this, until Nifty takes out 10880-10900 levels trend will not change.
Happy Trading!
Market update: Nifty Opened sharply up at 10780 levels and kept moving higher and higher and closed almost at the highest point of day at 11170 levels up 135 points.
Now since Nifty has crossed previous high with so much momentum and force, we have changed the near term to up. However please keep in mind that overall this leg remains a corrective rise and though it might stretch for a bit, it can finish suddenly without warning so inspite of markets breaking above previous highs, no fresh longs are advised at cmp.
We had mentioned yesterday Nifty needs to break below 10780 levels in next two days to confirm start of a new leg on the downside. Markets on the other hand have made a new high today.Todays high assumes lots of significance as 11171 was the previous high for Nifty ( before it was taken out and Nifty posted a new of 11750).
Inspite of the fact that markets made a new high today,there are many things which doesnot seem right at this stage. For starters there are plenty of negative divergences to be seen all around, secondly the volumes seems to be missing also todays rise seems to be news based ( opinion polls predicting BJP win) and lastly markets have turned overbought now.
It might be possible that this is part of pre election rally and Nifty sees higher levels from here and its also possible that its a false breakout ( in which case it should reverse soon).
Technically speaking, this pull back from lows of 10600 remains a ABC pull back but instead of flat its turning out to be zig-zag move.
Another important thing to note is that the fall from 11750 to 10K levels had taken 38 days and now mkts have already consumed around 92 days ( which is almost 250% of total time) and is still sitting below that high (infact its barely retraced 61.8% of previous fall). Now as per rules of Elliott wave/Neo wave, the corrective leg can consume upto 300% of time ( but those are rare) usually markets consumes 150-161.8% to 250-261.8% of previous move.
250% gives us 95 days & 261.8% gives us 99 days. We have consumed 92-93 days already hence a note of caution, these strong rallies we are seeing are coming too late and next few trading sessions could be really crucial. Having said this, until Nifty takes out 10880-10900 levels trend will not change.
Happy Trading!
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