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SGX Nifty 4th April 2016
SGX Nifty / Nifty Futures today was in the red and has begun the slow correction of the up move that we have been anticipating. As per our Nifty Prediction / Nifty Chart is indicating that Nifty will not sustain on the higher side. Does that mean Nifty can’t test 7800 area? It sure can why can’t it? But does that mean that Nifty will sustain above 7800 we do not see such a scenario and hence being in buying positions is not the best trade for now. We once again maintain and request you to understand our view correctly we do not expect mandi / bearish cycle for now all that we are saying is that Nifty will correct the up move / bullish move that it started from 6825 on 29th Feb 2016 as of now we are just doing to trade the pullback and then once again we see that higher side targets of 8000+ will come so as of now we are just trading the pullback. It could very well be that the pullback could even look like a mandi cycle to many and most people will again be selling when this pullback cycle will end in a few trading days but we are cautioning right now that sell now and then buy at lower levels again for targets of 8000+. Although Nifty still has higher top and higher bottom formation intact on the daily charts the speed and volume on the higher side are declining at a very rapid pace and that confirms the trend is now in mature stage. Also there is falling trend line channel and price has been within that since March 2015 since then prices on larger time frame has been showing weakness. So in a nut shell price has multiple resistances higher from here. Since this is effectively an ongoing X wave, X waves do not generally break channels and reverse from or just around the channels. Hence all the factors combined it does not make any sense to be into buying positions for now and makes more sense to sell from a tactical stand point. When and where to renter we into long trades we will see later but for the time being traders and investors must not remain long.
Let us now take a look at the sentiment indicators if we see most traders were selling Nifty Futures from 7150 onwards expecting 6500 and 6300 levels and their stop loss for the same was 7600 and at that time all of them were talking and justifying that “Nothing has changed materially” and “Earnings growth remains a challenge “ and now suddenly they all have conveniently forgotten all their reasons and all of them are now talking about levels of 8000+ citing 0.50 bps rate cut (sure levels even higher than 8000 will be seen but before that happens a corrective dip is likely, to what extent that pullback comes is what we need to see but in any scenario we see the pullback will come ) so if we understand what is going on closely we must rewind back to first week of Feb 2016 when Rahu (North Node) changed house and joined Jupiter (Rahu is the controller of the ongoing move). As we had predicted at that very juncture that Rahu is a master of deception and Jupiter will just act as an amplifier so what the net effect will be would be amplified deception and that is what we are seeing on the charts and in the minds of most people. First all of them were bearish till 7600 and they were justifying that being short is the right thing to do and now all of them are justifying being in buying positions. Since 95 percent of all people are now talking about 8000+ it is time to be very alert. As for our trades we have booked profits in positions bought around 7100 and now have started initiating positional shorts for trading the pullback move.
Nifty spot support and resistance for tomorrow 4th April 2016 is at 7570 and 7810. Use rise to exit longs for now. If we look at the entire structure purely from a Elliot wave perspective it is absolutely clear that there is no thrust on the upside which should have happened above 7600 if this wave was to directly touch 8000+ levels as we have observed over the past few days the thrust or momentum is totally missing and this confirms that current up move for this round is in mature stage. Nifty has hardly been able to move fast higher it has been a drag and boring move to be honest. Further the supply or the thrust from higher sides are increasing showing that overall corrective downside moves or simple retracements are in the offering so if we look at the first fall from Monday 7740-7582 was in about nine hours and then the move to take out 7740 took higher amount of time that means too means that the up move now is nearing mature stages as demand is very weak and also supply is increasing on the higher side. These are just a few reasons why we have got out of our longs and now started to short the Nifty Futures. Also the topping of this move has happened around powerful level 1 astro cycle trend changing days. If you remember there were three major level 1 signatures present and each of them individually are capable of trend change when all of them are combined the trend changes probability goes to as high as 95 percent plus in our historical back testing studies.
Use all dips to buy and hold sugar stocks. All of them will give massive returns over the next few months. We maintain we see sugar sector decontrol in this calendar year as per astro cycles. Short term traders can also accumulate MSL, Kesoram, Tata Coffee, NMDC on dips. All these stocks will do very well in the time to come. Please avoid Banks stocks from a short and longer term time from eventually we will not be surprised to see State Bank of India at 80 Rs and Axis Bank at 281 Rs. (Please do not take this as a short call when and where to short sell these counter will be told to our clients)
Good Trading To You!