7 January 2017


Hi Friends,

As mentioned in my previous post Nifty took Resistance near 8275-8300. Nifty tested 8306 however failed to close above 8275. As mentioned earlier Nifty has taken Support at the 50% Fibonacci Retracement and formed a Double Bottom near 7900 with Positive Divergence on RSI. All these are signs of possible Trend Reversal. However Bulls need to break above 8300-8338 to confirm Bull Trend.
The current Rise from the low of 7900 seems to be an Impulse as shown in the Hourly Chart Below. We can clearly see a 5 Wave move Up completing near 8306. This Impulse might be the Wave (i) of the New Bull Market. Nifty closed below important Intraday Support of 8250. Below 8250 Nifty may correct till 8183, 8151 or 8133 in Wave (ii) of the New Bull Market (If any.)
In my earlier post I also mentioned about Head & Shoulders Pattern. However, currently Bulls are having Upper Hand. The HnS Pattern may Fail if Bulls manage to take out 8300-8338. The Neckline of the HnS is near 7900. To Break the HnS Bears need to break the support at 8110-8065 and finally the Neckline near 7900. Currently Bears are on loosing side. And it seems that the Pattern is more likely to Fail.

As mentioned currently Nifty might be still in Corrective Mode in Wave (II) of one larger Degree.  Until Bulls take out 8300 Nifty would Remain in Down Trend. Bull Market will Resume above 8300, 8338. If Bears break the support at 8110 and 7900 Nifty may Decline to 7678 or lower to 7489.

Currently we need to watch price action near 8110 and 8338 carefully to determine future course of action. As mentioned Nifty seems to be completing correction in Wave (II). Investors need to find Stock Specific Opportunities over next 1-2 months to make Investment in Equities. Those who missed the Opportunity in Feb 2016 can surely look to Invest in next 1-2 months as the Market Bottoms Out.

Thanks & Regards,

Harsh Dixit.