NIFTY HAS ENTERED CORRECTIVE SIDEWAYS RANGE 4200-4500 

Last week market opened at 4375.40 & went up till 4439.95 to form the high of the week.It then continued to decline to register the low of week at 4249.70 & finally after sharp recovery closed the week at 4424.25.Thus it gained 49.75 points during the week over previous week’s closing.This is approximately 1.1% swelling in value. 

RETROSPECT: - Our expectation of nifty range bound within 4200-4500 has actually being followed  exactly.

SENTIMENTS: - Market sentiment is cautiosly bullish.However retailers have election result blues fresh in memory retail participation is at very low ebb as indicated by the open interest position of just 72000 crores. 

ELLIOT WAVE THEORY: - As stated in last many issues, on the shorter term the wave count from the 2539.45 though should be impulse,can be labeled in many ways.In a chart below we have shown two most probable wave counts on the chart.These are shown in the blue & green colours.Our first preference goes for the blue colour.In the green color wave count the retracement levels are far deeper & lower so we have avoided them for this week.In case nifty corrects very deeply in coming week then we will consider them next week.

As shown in the chart above if we take the blue color wave count as most probable wave count then this is unfoding in the form of zigzag correction.Within this zigzag wave (A) is over at 4143.25.Since then wave ( is unfolding.We expect the nifty to confine within 4143-4483 range for the coming week.Any breach above 4485 will be bullish & breach below 4143 will be bearish. 
 
 JAPANESE CANDLESTICK:- Last week it has formed the inverted hammer type candle however this is at much higher level & may be termed as hanging man later.In the absence of clarity we would avoid drawing any conclusion. 
 
 CHART PATTERN:- There is no specific pattern at the moment. 
 
 
PULSE-READING:- JKD soul voice says that the instant or initial reaction to the budget proposals will be false,deceptive & myopic.The real movie will began from 13^th july 2009. 
       
 

OUTLOOK & STRATEGY:-

We avoid any recommendations in light of the budget proposals.