NIFTY ON THE VERGE OF MAJOR BREAK OUT ? 

Last week market opened at 4945 & this itself was the LOW of the week.It then continued to rise to register the high of week at 5171 & finally closed the week at 5141.80.Thus it gained 196.60 points during the week over previous week’s closing.This is approximately 4.0% gain in value. 

RETROSPECT: - We are holding the nifty long of 4440 with the stop of 4400 after the hit of the two whipsaw stoplosses.

SENTIMENTS: - Market sentiment jubiliant & bullish.However the fun -fare & bull roar is beginning to appear as the momentum starts accelerating.This slow & steady rise is casting the shadow of doubt but it is good for long run as any runaway rise gets corrected equally fast.However the massive inflow of FII during last couple of weeks has started showing its color.Many emerging markets like Russia,Thailand & Phillipines are on the verge of upward break out & should impact the sentiments positively.On the top of all this the DOW'S trade above 10000 is the biggest boost. 

ELLIOT WAVE THEORY: - The stupendous surge from 3918.75 has compelled us to conclude that the new impulse wave has started unfolding.Therefore now we will concentrate our efforts to analyze the wave count from the low 3918.75 of 13th July 2009.At 4731.45 top on 4th Aug,2009 it has completed wave 1 as five wave upside sequence.Similarly it has completed a flat pattern at 4353.45 on 19th Aug,2009 & in accordance with the previous labelling it will be labelled as wave 2.Since then it has been unfolding the third leg on upside which is yet to be completed.We have labelled the internal wave count in daily chart below but more dtailed view is presnted in the intraday chart of nifty .

In the hourly chart drawn below we have shown the internal wave count.In this chart in very short term market has two probabilities & both are shown as green & red color wave trajectory.The green color wave count has 60% probability & may react down to 5040-5000 area & proceed for 5700.The red color wave trajectory has 40% probability & mat straight head for 5700.It is pertinent to note that in both the cases the major past wave counts as well as future wave counts & their targets remain unaltered.
 
 

JAPANESE CANDLESTICK:- Last week long white MORUBAZU candle reinforces the our all bullish patterns. 

CHART PATTERN:- In the weekly chart inverted head & shoulder pattern & ascending triangle patterns have just broken out & in the midst of again rising after completing the major pull back of major monthly break out.  
 

PULSE-READING:- JKD  soul voice says that nifty will trade above 5700 by 15 th Nov 2009. 
 

OUTLOOK & STRATEGY:- Our outlook is for the major break out on upside & at any dip we recommend adding to long position with the stop placed at 4980 for the target of 5700 & above.