NIFTY HEADING FOR NEW HIGH ABOVE 4693. 

Last week market opened at 4003.40 & went down till 3918.75 to form the low of the week.It then continued to rise to register the high of week at 4390.40 & finally closed the week at 4374.95.Thus it gained 371.05 points during the week over previous week’s closing.This is approximately 9.25% swelling in value. 

RETROSPECT: - Our conviction of the bottom formation within 3800-3900 range has turned out right.However we could not go long as market swiftly moved upward & in the coming week any decline we will utilize to enter long.

SENTIMENTS: - Market sentiment has twisted from hope prior to budget to disappointment after budget & then recent announcement kindled some hope.In short people are utterly confused as our FM & its policies.It is different matter FM displays confusion deliberately & people have confused by compulsion. 

ELLIOT WAVE THEORY: -  Last week we were expecting the unveiling of zigzag correction from the 4693.20.This was confirmed by the market action & zizag was terminated at 3918.75.The stupendous surge from 3918.75 has compelled us to conclude that the new impuse wave has started unfolding.This has partly resolved the previous wave count from 2539.45.We are considering the wave (1) terminated at 3511.25 on 16^th April,2009.Similarly the wave (2) terminated at 3351.50 on 28^th April 2009,wave (3) terminated at 4693.20 on 12^th June 2009 & now the wave (4) terminated at 3918.75 on 13^th July 2009.From 3918.75 we are witnessing the unfolding of wave (5).This has been shown in chart below.

      

For the shorter term we are of the view that Nifty may find it difficult to cross 4500 in the first two days of week & may correct downside in the range 4250-4220.Once this correction is over then it will attempt to cross 4500 during the later part of the week. 
 
 

JAPANESE CANDLESTICK:- Last week there was a white PIERCING LINE candle formation in the weekly chart.This has occurred after five consecutive negative or neutral weekly candles.In light of this PIERCING LINE candle assumes much greater bullish significance.

 
 
CHART PATTERN:- In the weekly chart there are two patterns are visible.First there is flag formation & second the inverted head & shoulder pattern.These are shown in weekly chart above & will assume significance once they breach resistance line & neck line respectively with the volume confirmation. 
 
 
PULSE-READING:- JKD soul voice says that the market has just entered the racing 5^th gear & there will be unimaginable, unpredictable, un-analysed stupendous rise will come in next few weeks & this will stunned every big & small participant in the Indian stock market. 

OUTLOOK & STRATEGY:-

We recommend going long on nifty at any dip below 4300 with the stop of 4200 for the initial target of 4700 & then higher.

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[DISCLAIMER]
This Newsletter is an expression of Technical Analysis. It is NOT a market prediction. It is NOT an advisory or suggestion to buy or sell any types of securities. This is an educational and learning exercise, only to share our methods of technical analysis. Trading and Investing MUST always be done with prudent money management and use of stop losses. One Bad trade can ruin the trader, so always keep risk low. IF you do not agree with the statements mentioned herein, please close this document, do not proceed further, do not read the Newsletter.