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Nifty Outlook for 04-01-2013 with overall view

Nifty ended marginally positive despite gap up opening. After strong opening at 6015 levels , Nifty could not maintain the strength as investors booked profit at higher levels. Finally Nifty closed with 16 points minor gain at 6009 levels.

On daily chart, Nifty has formed a Red “counter attack” candle with higher lower tail after two successful rising gap. The presence of this candle indicates that market may see intraday correction in an early trade. In case, if Nifty fails to hold above 6020 and remains below  6010 levels  then it  will see  intraday correction into the 2nd gap area around 5970 levels.Any trade below 5970 levels will lead further downward move into the 1st gap up area. On the other hand, if Nifty succeeds to hold 6010 and sustain above 6020 levels then we will see continuation in rise. In that case, Nifty will test 6045 and above that 6080 levels in coming trade. (Remember, Nifty has achieved minimum requirement of 5970 levels as a proportion of 80% correction of previous move “D’ble combination. As per rule it can go up to 101% which arise above 6335 levels but not necessary. Therefore,   traders are advised to be cautious.
The level of 5960 will act as trend decider level for the day. A sustainable move above this level will lead continuation in pullback around 6040-6080 levels in Nifty. However, failure to trade above this level will lead further downward move.

Support           :-      1)  5970   2)  5940
Resistance      :-      1)  6010   2)  6040


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Nifty retraced 80% of previous move....Now 6080,6180 remains watchable levels....strong possibility to hit 6335 again but that could be the end.....

In previous article (published on Nov. 2010. Feb 2011) we said about downward large “C” wave.

Further we said that it could be a triple combination (Published on 18th Jan 2012, as long term view). In that article, we said that Nifty will hit 3800-4200 levels in case of Triple combination but in case of D’ble combination it will end nearby 4400 levels. After that Nifty witnessed 28% fall (58 trading week) up to 4531 levels from the top of 6335 levels and again rebounded at 6000 levels ( rule of D’ble combination, See below “Long term view” chart).

As per proportion of D’ble combination, Nifty achieved “at least 80%” retracement of previous move which comes at 5970 levels and still showing strength ( Remember, D’ble combination always retraces “at least “ 80% of previous move and maximum it can retrace 101% of previous move as per rule. Means, there is strong possibility that Nifty may test 6335 levels in coming session but that could be an end of “B” of large “c” wave or any wave)
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