Nifty(4943): The corrective rally of wave 4 is over and the next leg lower of wave 5 has begun.
There is a gap area between 4920 and 4866 and the markets are likely to find temporary support around this area. Yesterday's low was exactly at the top end of this gap range. However, this is not fatalistic and if the market were to plunge through this it would signify intensity of the weakness to come. Nifty took 9 trading sessions to bounce from 4639 to 5099 and quite often impulse move like the one we have assumed exceed the move in equal or lesser number of sessions. So if we are correct a new low should come through on or before 21st December.
New position: Short Siemens 714 for a price objective of 650 SL 736 (all cash levels)
13 Responses to “Technicals Dec 9th 2011”
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Possible target/s for Wave 5?
New low defintely. 4620 or 4300 let us see how it evolves
Tentative time frame for Wave 5? Not considering extensions if course.
Very tough to put a time stamp on it. We are still in 1st subdivision of 5. A stronger subdiv iii and v will come.
Shouldn’t Wave 5 end lower than Wave 3?
One of those days agile? Ive said 4620 or 4300 😀
ok ok don’t rub it in…happens to all of us once in a while…:-)
maybe more often to me…:-P
thinking…4620 is only midly lower…so technically lower but……
ah well… 🙂
Trading strategy discussion:
In all probability sub division i is over on Friday and we start sub division ii on Monday.
Do you feel 21st December (on or before) will signal end of Wave 5 sub division v or Wave 5 sub division iii?
Cheers.
hi jai,
a small request for laymen’s like us apart from the technicals of wave count, if you can just mentions the possible routes in figures with respect to nifty like range from (5000 to 4850 and from there to 4980), it will help us understand, one more thing i had asked about LT i had short one lot @ 1295, you had advised stop loss @ 1360, but till what target i should hold it on downside in this current trend, cover it at what levels and again short it at what levels?
LT If its a portfolio short hold for 3 digits. 1100 otherwise
Jai your view on gold and silver after the ECB decision? Thanks
Ive been bearish on Gold and Silver for several weeks now, nothing to do with ECB events though. We are still short Silver (profitably) and got stopped out in Gold several weeks back. Silver if it breaks below 30.9 it will open bigger downsides. So if you want get onboard wait till Silver breaks $30.9. I will tell you one thing – Gold will tank to $1310-1400 in the next 12-16 weeks, I just do not know if it will go to 1875 and then drop or if it will drop straight from here. I will be watching for a low risk shorting chance though.
Best regards,
Jai
Dear Jai,
i was reading somewhere today that agro commd prices has fallen drastically….. can u pls check on this segment if that is true….. it means inflation could fall drastically in india and RBI wud start lowering the rate soon. So we may tone dwn our bearish stand in future…. also some stock in that category could be shorting and buying candidates…..based on that.
Regards,
Vipan
Dear Vipan,
India is not going down bcos of inflation, I had said this in Jan 2011 – the structure of the global markets are in deterioration mode. China clocked new low last week, below Oct/Nov low and might accelerate lower after a relief rally or without it. The world is in Deflation mode – and deflation spares no asset class including Precious metals. Nevertheless, as a technical trader the advantage we have is that, TA is flexible by its very nature – so the market will tell us if we need to change our view.
Best regards,
Jai