Tuesday, October 22, 2013

NIFTY- IS IT A NEW BULL OR ON THE VERGE OF ENTERING NEW BEAR?

Hi Friends,

Nifty has given a Fast and Furious Rally from the low of 5118. Within 1.5 months Index has gained more than 20%. Index has reached near the Life Time High and the consensus is that this is a start of New Bull. Not only retail but Few Analysts have started believing in New Bull and postulating a Target of 7300-7800-8400 on Nifty in 2 years..

But are we really entering a New Bull? My Chart reading don't support any evidence of New Bull. Before entering a New Bull there is always some consolidation for 3-6 months. However no such consolidation was visible near 5118. Instead there are signs of distribution near 6200.
NIFTY
As mentioned in my previous post Nifty seem to be in Huge Ending Structure from Last 2 years from 4531. Whether Ending Diagonal or Complex Correction the labels don't matter until we know its just a Corrective Rally in (E) or (Z) wave of this Structure. And this Rally is about to die.

As per my reading Nifty seem to be in 'c' leg of this Final (E) or (Z) wave which might end near 6237-6256-6282. And we might see a move down to 6033-5981 in next few trading sessions in 'd' leg.  If Nifty holds the support near 5981-6033 we might see another move in'e' leg to 6319-6334 till Nov 1st week. This final (E) or (Z) might be developing as an Ending Diagonal itself. And as per seasonality Market is expected to remain Up till Diwali.

The upside from here looks very limited and shall be used to exit longs. Strictly avoid fresh longs at current levels. Post completion of the Ending Structure we might witness a huge down side back to 4500 or lower in a year ahead. Whenever we get the evidence of the end of this move I would be looking for immediate downside to 4900-5000 till Jan 2014.

Thanks & Regards,

Harsh Dixit.

3 comments:

Karthi Keyan said...

Right Time for very good Observation ...

MUKUND RAO BODKE said...

There was great trigger for this rise. No great changes in macro economics of the country. Good observation.

MUKUND RAO BODKE said...

sorry no trigger