SGX Nifty 29th Dec 2015
SGX Nifty / Nifty Futures Minor Trend is Neutral. SGX Nifty / Nifty Futures Major Trend is positive / bullish. As per our Indian Stock Market Analysis / Nifty Prediction we expect a panic bottom formation around 7500 (Intraday could even breach 7500 or for a few trading days is also possible) and in the near term on the upside we do not see Nifty moving above 8100, Nifty could halt its current pullback even between CMP-8100 and we do not see Nifty sustaining above 8100 levels for now at least and then a panic bottom formation will take place around 7500. Open interest data shows good resistance is at 8000-8100 so please be careful at higher levels and avoid fresh buying at higher prices on dips around 7500 from a positional stand point buying must be done as longer term we are very bullish on Indian Stock Market and our upside targets for this year till Diwali 2016 is 8800-9000 (8800-9000 will come well before Diwali 2016) but that will be the upside targets for this year as per our Nifty Prediction.
Nifty Futures has been strangling to move higher and has filed to gather any momentum over the past 9-10 trading days. As per our analysis we clearly are expecting this move to be corrective and everyday the same classic parameters are confirming the same. One of the most important parameters in my analysis is volume and volume is completely missing on the move from 7553-CMP which means that this is not the real move that we are expecting. If we look at another parameter speed then as per basic rules if this was a real move towards 8800-9000 then in that case we should have taken out the X wave top or also in this case the previous swing high of 7980 in lesser amount of time and that too has not happened further confirming our analysis. (The fall from 7980 to 7553 took 8 days and it is already over 9 trading days but we are no where near the top of 7980 )
There is also another unconventional yet very simple way of looking at charts and understanding that this is a corrective wave for those who do not understand Elliot wave or Gann Wave or time cycles. Lets look at the Daily RSI (Relative Strength Index) the daily RSI is right now at 57 and if we move up by another 150-200 points this will reach a over bought area, if this reaches over bought area around lets say 8100 then how will with such a over bought situation how will Nifty move towards 8800-9000? Also the implied volatility is such that to get the RSI lower Nifty will have to fall sharply so even a very basic indicator like RSI is clearly indicating a fall towards 7500 in panic post a lower top around 7950-8100.
Nifty support and resistance for tomorrow 29th Dec 2015 is at 7821 and 7968. Caution is advised on the higher side.
Good Trading To You!