3 October 2012

NIFTY AT INFLECTION POINT

Hi Friends,

Yesterday I wrote about 5th Extension within 'c' of 3rd on Nifty. However, after carefully observing the charts, we have now two possibilities on Nifty.
NIFTY- 5th EXTENSION IMPULSE

1. As per the yesterday's post 5th within 'c' of 3rd might be developing as Extension Impulse Wave. Break above 5756-5780 will confirm the target of 5944-6040 in this case. 
NIFTY- ENDING DIAGONAL IN 'C'

2. The entire formation from low of 5215 might be developing as an Ending Diagonal. Ending Diagonal generally develops in 5th or C wave.. So Break below 5691 will be initial sign of weakness and below 5639 we will get confirmation for 5520-5440.

So at this crucial juncture Bulls must keep strict stop-loss of 5639 and wait for break above 5756-5780 to Ride further Up Move. And Bears must wait for break below 5691 and confirmation below 5639. Once 5639 breaks Bears can take a short trade on corrective pull back for target of 5520-5440.

Since, momentum is loosing as seen from RSI Negative Divergence formation discussed in 2nd is more probable.

So lets wait & watch..

Thanks & Regards,

Harsh Dixit.