Nifty(4760.60): It has taken just 3 sessions to retrace a little over 3/4ths of the move from 4640 to 5100. The probability that wave ii of wave 5 ended on Friday itself and the markets are progressing in wave iii of wave 5 is quite high. In simple terms, the markets are in the most powerful leg of the move within in this decline is very likely.
Nifty hourly charts
If this is the case, the minimum measurement for this powerful leg works out to 4505. In the extreme short-term, market could find support in the region of 4690-4720 and have a small relief rally or it may just plunge straight through 4690 and go for the breach of 4640.
In other markets, Gold has breached an important support .
Gold Daily charts
Ill keep this very simple - as can be seen from the chart above, a trendline has been established (blue dashed line) and Gold went below its previous support of 1667. Overnight, there was also a strong rally for the dollar index. If you want to short Gold, the stop is $1770 on the front month contract (a few points above Dec 2 high if you use any other contract). I expect Gold to hit 1410-1380 atleast in the first 6 months of 2012. To be honest, Gold has whipsawed me on a couple of occasions and that is the only reason for not having an official trade here but this is a clean set up, atleast for the short-term.
Silver: We are already short from 34.2 and have taken part profits. If silver drops below 30.65, add back the same quantity you booked at $31.4 and revise stop to 33 as stop for a target of $26.
12 Responses to “Technicals 13th Dec 2011”
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What is the maximum downside you are looking at in wave iii?
4248
Hi,
A couple of things.
1. What’s the anticipated path for nifty once it touches 4500 ?
2. hero has just started to correct yesterday ? When do you suggest we cover our shorts.
3. If there is a bounce at 4500, which longs and at what levels do you think we should be prepared for ?
Thanks
Jay z
After iii ends a relief rally and then another leg down. Hero closer to 1900 we will see how it behaves, if it plunges through we will hold for 1750. else take off and reload
Jai,
I remember reading / hearing your comments that there might be one final leg up in IT. Have we crossed over and do you see any opportunity in shorting the IT pack ?
Regards
About to finish. I do not know which one will through up but yes. I usually prefer shorting wave C, Wave 3 and Wave 5 rather than wave1 or A (which are difficult to identify)
Jai Bala,
Can you post your analysis of ‘Rs Vs Dollar’ chart with detailed Elliott wave labeling. I am requesting this for educational purpose.
– Kishan Bobba
Will post it today.
Hi Jai,
I was away for a weeks time and couldnt catch up with the market. I am holding 1 lot of heromotocorp short position since 2080. What is ur take, shall i hold or take the profit.
Ajay
Hold, I think a breach of 1900 and hence bigger downsides is about to come through.
Super call on silver, Gold, currency and also markets. If were you …….I would be booking my tickets to Salzberg….
Rut
Thanks 🙂 You book ur holiday soon 🙂