Last week nifty opened at 5180.75 & went down to register the low of the 5160.10.It then rose to mark the high at 5221.85 & finally closed the truncated week at 5201.05.Thus it gained 22.65 points over the previous week which is just short of 0.5% gain.

RETROSPECT: - We had recommended buy at every dip with the stop of 5110 last week. This has been in the right direction & traders are in standing with thin positive side.

SENTIMENTS: - Market sentiment is certainly optimistic with the close above 5200 & bulls were able to carry the profit home on expiry.With this & expectation of the new year allocation for emerging market participants are bit excited.

ELLIOT WAVE THEORY: - The stupendous surge from 3918.75 has compelled us to conclude that the new 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 labeling it will be labeled as wave 2 .From 4353.45 it has unfolded the third leg of the rise till 5181.95 on 20th Oct,2009.Accordingly we have labeled this as wave 3. From the top of the 5181.95 it has declined to 4538.50 in 10 trading sessions. This we labeled as the wave 4.From the 4538.50 we are viewing as the resumption of wave 5.

           The wave 5 can have two forms. The first & less probable one is the diagonal triangle formation & this should not cross 5320 in any case otherwise wave count will be negated. This has been shown in green color on the chart. In the second wave scenario at 5138 the first leg of the wave 5 terminated & at 4943.95 the second leg terminated. Since then it is unfolding the third leg of wave 5.For this wave count to be valid it must cross 5320.This has been shown in maroon color on the chart. The target of this third leg comes anywhere above 5500.

JAPANESE CANDLESTICK:- Last week it has formed the small white candle in continuity of long white MORUBZU of prior week.This indicates the upward move's continuation.

CHART PATTERN:- There clean ASCENDING TRIANGLE FORMATION has emerged as shown in the weekly chart above.This triangle formation is just on the verge of being broken out.We estmate that this break out may terminate at 5700-5800 range.

PULSE-READING:- JKD  soul voice says that just watch the FII INVESTMENT figure & Government annoncement for the future course of nifty in coming weeks.

OUTLOOK & STRATEGY:- Buy at every dip below 5320 with the stop of 5110 & on cross of 5320 just do the momentum buying with the appropriate stop. Do not remain on long side below 5040.