Friday, August 10, 2012

Nifty hits "resistance", and USDINR finds "support"!

Nifty Hourly Chart
This is not an attempt to exemplify the correlation between USDINR and Nifty, but just an observation I am sharing here. I am currently counting a I-II/[1]-[2]/(1)-(2) formation on the chart of Nifty, I am expecting Nifty to breakout from the resistance zone around 5340-50 and rally handsomely towards the 5630 level. On the other hand USDINR, has found some support in the 55.00-55.10 zone. We may see prices touching the 55.60-55.70 zone to complete the wave 2 on the chart below. In USDINR too we have a {1}-{2}/1-2 formation going on, but in exact opposite direction of Nifty. Though we cannot entirely bank on this inverse correlation between Nifty and USDINR, marking waves on charts of both the tickers, indeed help us in better classifying the waves. So right now I am hoping Nifty would resume the up move and USDINR its down move, sooner than later. I would become skeptical of these respective moves, if Nifty trades below 5280-70 band, and USDINR trades above the 55.60-55.70 band, till such time the existing count is intact.
USDINR Hourly Chart
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