Firstly Correction and then Consolidation Before Decisive Rally

Weekly Analysis-11-04-2011 to 15-04-2011

5911 target was given and after its achieving correction possibility was told daily in previous week because indicators were overbought and sentiment was heated therefore correction was technical requirement and it started in previous week.

All trends are up,Wave-5 is on and corrective Sub Wave-F is on after Sub Wave-E fast 596 points gains in 13 sessions. Nifty traded most of the time between 5855-5945 in previous week and weekly range broken down in last hours on 08-04-2011. As weekly range was broken down in previous week therefore deeper correction possiblity turned higher and confirmation will be sustaining below 5855 in the begining of coming week.

1- Waves Structure-chart:-

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2- Sub Wave-F is on- chart:-

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3- Micro-Analysis of previous Week Intra Day Chart(Weekly Trading Range 5855-5945 and its Breaking Down Chart):-

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Conclusions (After Putting All Studies Together)

Micro-Analysis of previous week intraday chart is confirming distribution in previous week and breaking down of weekly trading rahge is also clear from last Friday intraday chart Micro-Analysis. It is confirmation of correction and its continuation will be seen in the coming week.

Nifty traded most time between 5855-5945 in previous week and sustaining below 5855 will rule out the possibility of range bound correction and in that situation deeper correction will be seen according to Fibonacci Retracement Levels

Weekly indicators are showing begining and continuation of upmoves while daily indicators are overbought and showing begining of correction. Firstly Daily indicators will cool down and after that rally will resume after last week begun correction completion.

Weekly MACD upward intersection of Average Line is crucial development and confirmation of strong rally after last week correction completion.

Fibonacci Retracement Levels should be watched after sustaining below 5855 and as per my view following levels should be watched specially for correction completion confirmation:-

1- 5762
2- 5651
3- 5561

Finally strong rally expected but before that correction will be seen. Market require complete consolidation after last week selling and until that will not happen till then fresh up move will not start. Let correction complete then up move will be considered. Slipping expected in the begining of week, Correction will take its own time in its process and its completion not expected in the coming week.

If Nifty sustains below 5855 then deeper down moves and Red weekly closing will be seen

Micro-Analysis of previous Week Intra Day Chart(04-Apr to 08-Apr-2011)

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Following selling conclusions from Previous week intraday chart Micro-Analysis 

1- Last 4 days selling at higher levels.
2- Lower top and lower bottom formations.
3- Whole week trading Range between 5855-5945
4- Weekly range breaking down in last hours on 08-04-2011

Post-closing Report(08-04-2011) & Monday Outlook

Fresh selling between 5857-5870
3 days range(5855-5945) broken down
New weekly low formation.
Closing near weekly lows

Ratios:

Nifty Put Call Ratio: 1.06
Nifty P/E Ratio: 22.18

Advances & Declines:

BSE ADVANCES : 1000
BSE DECLINES : 1966
NSE ADVANCES :  335
NSE DECLINES : 1092

Nifty Open Interest Changed Today:-

Nifty- 5800 CE(28APR2011)- +447550(+10.62%)
Nifty- 5800 PE(28APR2011)- +49450(+/+0.87%)

Nifty- 5900 CE(28APR2011)- +383250(+6.37%)
Nifty- 5900 PE(28APR2011)- -425450(-11.37%)

Closing :-

Nifty- closed at 5,842.00(-43.70 Points & -0.74%)
Sensex- closed at 19,451.45(-139.73 Points & -0.71%% )
CNX MIDCAP - closed at 8,288.30(-130.75 Points & -1.55%)
BSE SMALL CAP- closed at 8,772.55(-124.64 Points & -1.40%)

Nifty Intra Day Chart of Today:-

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Monday(11-04-2011) Outlook


Correction is confirm market is prepared for some more down moves. Expected that Nifty will move below  5800 and short term trend will also be down. Market slipped without force on 08-04-2011 therefore early correction completion may be expected but complete consolidation is required for any rally.

5855 will be watched and sustaining below will mean deeper corrction and its possibility can not be ruled out.

Weekly Indicators and Averages Analysis

Weekly Indicators and Averages Analysis Chart:-

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Conclusions from Weekly Indicators and Averages Analysis

1-Averages- All(5,21,34,55) the shorter term weekly averages are above longer term weekly averages and Nifty is above all.It is Bullish market confirmation.

2-Bollinger Band- Nifty is in the middle of band little above middle line and indicating possibility of more up moves.

3- MACD- Most important development this week that MACD line intersected Average line up side and given confirmation to rally. Weekly MACD cross over gives confirmation to long trend therefore strong confirmation to up trend.

4-ROC- moved above equalibrium line and given up moves confirmations.

5-RSI- moved above equalibrium line and given up moves confirmations.

6-Slow Stochastic- Both lines in overbought zone but tend to remin in overbought area for a longer period and until other indicators does not gives downward confirmation till then will remain in overbought zone.

7-William %R- is below overbought zone,moving upward and showing more upmoves possibility.

Conclusion


Weekly indicators are showing begining and continuation of upmoves while daily indicators are overbought and showing begining of correction. Firstly Daily indicators will cool down and after that rally will resume after last week begun correction completion.

Daily Indicators and Averages Analysis

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Long Term and Intermediate term trends are up and very short term trend is down.

Conclusions from Daily Indicators and Averages Analysis

1-Averages- All(8,21,55,200) the shorter term averages are above longer term averages and Nifty is above all.It is Bullish market confirmation.

2-Bollinger Band- Upper Band moved up with Nifty rally and gap between both bands expanded. Squeeezing of both bands is technical requirement. It is the nature of  Bollinger band that price tends to return to the middle of the bands and Nifty retracement toward the middle of Band is possible which is near 5700.

3-MACD- MACD Line is above Average Line and gap increased in both lines therefore convergance in both lines is technical requirement. Nifty down move has begun in previous week and more down move is also possible in the process of convergance.

4-ROC- is retracing and equalibrium line testing possibility can not be rules out in correction process.

5-RSI- is retracing from overbought zone and equalibrium line testing possibility can not be rules out in correction process.

6-Slow Stochastic- very short term fast moving indicator and both lines have started to move down from overbought zone and indicating more down moves

7-William %R- very short term fast moving indicator and in overbought zone. It has tendency to remin overbought. As other indicators are also indicating correction therefore  its dipping from overbought can not be ruled out.

Conclusion

Correction begun in previous week and insicators are suggesting its continuation in the coming week

Weekly MACD upward intersection & Weekly Gravestone Doji Candle

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Weekly MACD upward intersected Average Line in previous week after 19-11-2011 and given positive moves strong indication but on the other hand 'Gravestone Doji Candle'(Bearish) formation in previous week

Weekly MACD:- 3rd wave which begun on 13-07-2009 from 3919, terminated at 6338 on 05-11-2010 and 4th corrective wave begun which terminated at 5177 on 11-02-2011. Weekly MACD upward intersection Average Line in previous week is 4th corrective wave termination and 5th impulsive wave begining confirmation.

Gravestone Doji:- 5th impulsive wave begun on 11-02-2011 from 5177 and faced resistance at 5944 in previous week. Gravestone Doji weekly Candle in previous week is Short term correction begining confirmation of 1st leg of 5th wave.

Conclusion

Nifty will first correct 1st leg of 5th wave(5177-5944) according to Fibonacci Retracement levels in the coming week and then rally will begun to test levels above 6120.

Fibonacci Retracement Levels

Rally begun on 11-02-2011 from 5177
Correction of this rally begun on 06-04-2011 from 5944

Fibonacci Retracement Levels of on going correction are as follows:-


13.0%- 5844
23.6%- 5762
27.0%- 5736
38.2%- 5651
50.0%- 5560
61.8%- 5469
70.7%- 5401
76.4%- 5358
78.6%- 5341
88.6%- 5264

Micro-Analysis of Nifty Intra Day Charts(08-04-2011)

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1- Selling between 5855-5875
2- Down Move in Falling Channel
3- Slow Down Move without Force
4- Intra day last hour consolidation between 5823-5842

Last 3 days range broken down after intraday selling but breaking down is without force in falling channel and last hour intra day consolidation seen between 5823-5842.

Conclusion
Correction is confirm on but breaking down move was without force therefore it is an indication of early correction completion but market require confirmations. Firstly complete consolidation and then crossing of immediate resistance will be first corretion completion confirmation.

FII Trading Data in Derivatives Segment on 08-Apr-2011

Nifty Spot-Levels & Trading Strategy for 11-04-2011

Nifty Spot-Levels

R3 6008
R2 5967
R1 5904
Avg 5863
S1 5800
S2 5759
S3 5696

Nifty Spot-Trading Strategy

H6 5946     Trgt 2
H5 5922     Trgt 1
H4 5899     Long breakout
H3 5870     Go Short
H2 5861
H1 5851
L1 5832
L2 5822
L3 5813     Long
L4 5784     Short Breakout
L5 5761     Trgt 1
L6 5737     Trgt 2

Nifty(Apr Fut)-Levels & Trading Strategy for 11-04-2011

Nifty(Apr Fut)-Levels

R3 6006
R2 5966
R1 5910
Avg 5870
S1 5814
S2 5774
S3 5718

Nifty(Apr Fut)-Trading Strategy

H6 5950     Trgt 2
H5 5928     Trgt 1
H4 5906     Long breakout
H3 5880     Go Short
H2 5871
H1 5862
L1 5845
L2 5836
L3 5827     Long
L4 5801     Short Breakout
L5 5779     Trgt 1
L6 5757     Trgt 2

Bank Nifty(Apr Fut)-Levels & Trading Strategy for 11-04-2011

Bank Nifty(Apr Fut)-Levels

R3 12069
R2 11979
R1 11845
Avg 11755
S1 11621
S2 11531
S3 11397

Bank Nifty(Apr Fut)-Trading Strategy

H6 11935     Trgt 2
H5 11885     Trgt 1
H4 11834     Long breakout
H3 11772     Go Short
H2 11752
H1 11731
L1 11690
L2 11669
L3 11649     Long
L4 11587    Short Breakout
L5 11536     Trgt 1
L6 11486     Trgt 2

Nifty Spot-Weekly Levels & Trading Strategy(11 Apr to 15-04-2011)

Nifty Spot-Weekly Levels

R3 6038
R2 5991
R1 5916
Avg 5869
S1 5794
S2 5747
S3 5672

Nifty Spot-Weekly Trading Strategy

H6 5964     Trgt 2
H5 5936     Trgt 1
H4 5909     Long breakout
H3 5875     Go Short
H2 5864
H1 5853
L1 5830
L2 5819
L3 5808     Long
L4 5774     Short Breakout
L5 5747     Trgt 1
L6 5719     Trgt 2

FII & DII trading activity in Capital Market Segment on 08-Apr-2011

FII trading activity on NSE and BSE in Capital Aprket Segment(In Rs. Crores) Category Date Buy Value Sell Value Net Value FII 08-Apr-2011 2688.69 2303.84 384.85

DII trading activity on NSE and BSE in Capital Aprket Segment(In Rs. Crores) Category Date Buy Value Sell Value Net Value DII 08-Apr-2011 982.97 1111.37 -128.4

Pre-closing Outlook(08-04-2011)

Nifty slipped below 5857 after today fresh selling between 5857-5870 but down move is without force and last one hour move is giving intra day support signals between 5825-5840. Correction is on and its completion signals not generated yet.

Mid-session Outlook(08-04-2011)

Nifty traded 3 days between 5855-5945 and technical positions within this range has already been explained in 3 previous outlooks. Certainly Indian markets under performed Asian markets,slipped sharply in first hour,moved below 5855 but not sustained below 5855 also and trading between 5943-5870. It means market has not given breaking down confirmation yet despite slipping below lower levels.

5857-5870 was base formation range of 05-04-2011 and Nifty is trading betwen this range after 1st hour slipping. Breaking out conclusions of this range will be as folluws:-

1- Sustaining above 5870 will mean revival of up move hopes and testing possibility of levels up to 5945.

2- Sustaining below 5857 will mean deeper correction.

 

Although 5855 broken down today but confirmation required and final view should be formed according to break out of 5843-5870

Post-open Outlook(08-04-2011)

Although all the Asian markets turned positive after flat opening and sentiment improved but Indian markets slips from day's higher levels and trading in Red because correction is on.

Confirmation levels have already been expressed in 2 previous outlooks therefore final conclusions will be drawn according to that. Nifty is trading at 5859 and today low is at 5855.40. Sustaining below 5855 will mean certain deeper correction.

Pre-Open Market Outlook(08-04-2011)

Following line was told in Post-closing Report(25-03-2011) & Monday Outlook:-

"21st March 2011 started rally minimum target is 5911"

More than 10 times only 5900 was told after above line and rally halted exactly at 5900 and Nifty is hovering it around for the last 3 days.

Sentiment were heated,Indicators were overbought and 596 points rally seen in 12 sessions therefore correction was natural and being seen for the last 3 days. Market may correct in narrow range or little deeper down moves and it will be decided through last 3 days broader range(5855-5945). Next moves after break out of last 3 days range(5855-5945) will be as follows:-

1- Crossing and sustaining above 5945 will mean 6120 fast
2- Slipping and sustaining below 5855 will mean deeper correction.

Market is not prepared for any side moves and will take its own time in this process. Global cues are quiet today morning and Nifty will trade first within 5870-5915. Technical positions within both ranges have alreay been discussed yesterday in "Post-closing Report(07-04-2011) & Tomorrow Outlook" and not being repeated today.

As I told in last 3 days same is repeating today that let market prepare then final conclusions will be drawn from intraday patterns. Last 3 days closing is also almost flat without much gains or loss. Real moves will be seen after break out of mentioned ranges therefore will be better to wait for its happening and next real moves confirmations.

Post-closing Report(07-04-2011) & Tomorrow Outlook

Nifty Candle- Doji(Confusion)
Nifty Intra day trading patterns- Mixed Formations
Nifty trading range- 5867-5906
Consolidation between- 5867-5680
Distribution between- 5888-5905

Whole day narrow range market with intraday supports at lower levels and resistance at higher levels. Mid cap Cap and BSE Small Cap Indices with good gains and positive trading patterns

Put Call Ratio : 1.05

Advances & Declines:

NSE ADVANCES : 1,921
NSE DECLINES : 1,037
BSE ADVANCES : 1,460
BSE DECLINES :   687

Nifty Open Interest Changed Today:-

Nifty- 5800 CE(28APR2011)- +25350(+0.59%)
Nifty- 5800 PE(28APR2011)- +553200(+10.73%)

Nifty- 5900 CE(28APR2011)- +902150(+17.26%)
Nifty- 5900 PE(28APR2011)- +661450(+20.37%)

Nifty- 6000 CE(28APR2011)- +222400(+3.46%)
Nifty- 6000 PE(28APR2011)- -34900(-1.88%)

Closing :-

Nifty- closed at 5,885.70(-6.05 Points & -0.10%)
Sensex- closed at 19,591.18(-21.02 Points & -0.11% )
CNX MIDCAP - closed at 8,419.05(+77.05 Points & +0.92%)
BSE SMALL CAP- closed at 8,897.19(+110.25 Points & +1.25%)

Nifty Intra Day Chart of Today:-

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Tomorrow(08-04-2011) Outlook


Mixed formations and Indian markets are not prepared for any side decisive moves. Firstly trading between 5870-5910 and sustaining beyond this range will give strong indication of break out side of broader range(5855-5945).
          
Trending market is expected in next week after break out of mentioned last 3 days brodaer range and Nifty will trade within this range tomorrow. .

Trend Deciding Intra Day Ranges

Following Ranges developed in last 3 days intra day charts:-

1- Broader Range and its break out will give next big moves confirmations - 5857-5945

2- Narrow Range and its break out will give first strong indication of next moves- 5870-5915

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Patterns within above ranges are:-

1- 05-04-2011- Support between- 5857-5870

2- 06-04-2011- Selling between- 5880-5910

3- 07-04-2011- Support between- 5867-5680

                         Selling between- 5888-5905

Next strong moves will be decided from the break out and sustaining beyond above ranges. Indian markets will prepare within mentioned ranges in the same manner as prepared today and break out will generate sharp moves.

FII & DII trading activity in Capital Market Segment on 07-Apr-2011

FII trading activity on NSE and BSE in Capital Aprket Segment(In Rs. Crores) Category Date Buy Value Sell Value Net Value FII 07-Apr-2011 2675.95 2455.36 220.59

DII trading activity on NSE and BSE in Capital Aprket Segment(In Rs. Crores) Category Date Buy Value Sell Value Net Value DII 07-Apr-2011 881.68 1093.84 -212.16