NIFTY HEADING FOR 5200+ LATEST BY 12TH AUG,2009.

Last week market opened at 4568.65 & went down till 4420.80 to mark the low of the week.It then continued to rise to register the high of week at 4669.75 & finally  closed the week at 4636.45.Thus it gained 67.90 points during the week over previous week’s closing.This is approximately 1.5% swelling in value.

RETROSPECT: -  Last week we had suggested going long on any dip below 4500 with the stop f 440 for the target of 4700.We saw a dip of 4420 on last Wednesday & logged the long position.
SENTIMENTS: - Market sentiment has been jittery bullish as market swing wildly near the previous top of 4693.Attempts to cross the 4693 were encountered by heavy selling pressure which added fuel tofire on volatility.

ELLIOT WAVE THEORY: - 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 16th April,2009.Similarly the wave (2) terminated at 3351.50 on 28th April 2009,wave (3) terminated at 4693.20 on 12th June 2009 & now the wave (4) terminated at 3918.75 on 13th 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 is extending as well as subdividing the 5th wave from 3918.75.At 4557.20 it has completed the wave (i) & wave (ii) completed at 4420.80.Since then it is unfolding the wave(iii).The wave(i) was of 639.20 points.It is reasonable to assume the wave (iii) to be  1.382 to 1.618 times the wave (i).This works out to be 5304 & 5455 respectively as the likely target of wave (iii).Similarly timewise it works out to be 10-08-09 to 12-08-09.Hence our estmate at 5300 latest by 12th Aug,2009.

JAPANESE CANDLESTICK:- Last  two weeks there were  white weekly candles confirming the  piercing line.
 

CHART PATTERN:-  In the weekly chart there are two patterns visible.First there is flag formation & second the inverted head & shoulder pattern.These were reported last two weeks.The flag formation has broken on upside.However the break out from the inverted head & shoulder has not materialized & we hope that it will in the coming week.

PULSE-READING:-  JKD soul voice says that the market has just gearing up for higher momentum trajectory of 5300.

               
OUTLOOK & STRATEGY:-
We recommend to hold the long position entered last week with the stop of 4550 for the target of 5300.Aggressive traders may add further long positions on dip below 4600with the stop of 4550.