Last week nifty opened at 5072.30 & went down to register the low of the 4984.80.It then rose to mark the high at 5212.70 & finally closed the  week at 5093.50.Thus it gained 2.65 points over the previous week which is 0.05%.

RETROSPECT: - Our cautious mild negative bias is vindicated by the market.. 

SENTIMENTS: - Market sentiment has further deteriorated & participants have increasingly become bearish.In fact there was nothing as events or news which could have boosted the sentiments. 

ELLIOT WAVE THEORY: - The recent price drop of last week has more or less left with the only one wave count as follow.

      The last week's decline makes us to believe that the wave starting from 2539.40 on the 6TH March 2009 in 90%probability is over & its corresponding degree wave correction is underway. The reasons to believe are not far to seek behind. The advance decline, the volume, momentum, diverging oscillators & many more. The converging lines of diagonal triangles or traditionally speaking it is within wedge & may continue to trade within these lines as 10% probability. We are of the view that it is a herculean task for the nifty to break upside of rising trend line. From the ELLIOT PERSPECTIVE the rise from 4675 has been labeled in two ways & this has been shown in blue & red color in the chart. The blue color wave counts call for one more new high above 5400 but it should cross 5300 to reinforce itself. Similarly  the red color wave count points that nifty will not cross 5400 & may scratch new bottoms. However to reinforce nifty must breach 4985.The area of 4985-5300 is trading range area. 
 
 

JAPANESE CANDLESTICK:- Last week it has formed the upper long legged candleafter black MORUBAZU CANDLE. This points to it's weakness to hold the upper levels & hence the bearish undertone.

CHART PATTERN:- With each passing week the RISING WEDGE  is emerging as imminent outcome.However till lower trendline is not breached the rising wedge pattern can not be confirmed. 
 

OSCILLATORS READING:- The daily RSI,STOCHASTIC & MACD has entered the sell mode & signals further decline.The weekly RSI,STOCHASTIC & MACD  have enterd the sell mode & they are diverging at the same time. 

SECTOR ANALYSIS:- This week we intend to analyse the NSE BANK INDEX.This sector has out performed the market since March 2009.This sector has risen stupendously but lately it has started showing the sign of fatgue & oscillators diverging.We would advise profit booking those who are long in sector.Investors can reneter at 8400-8600 level.

PULSE-READING:- JKD SOUL VOICE SAYS THAT IF YOU ARE PLAIN INVESTOR BOOK PROFIT & TAKE MONEY OF THE TABLE.COME BACK AFTER CELEBRATING THE DIWALI.IF YOU ARE A PROFESSIONAL TRADER PLAY HEDGE SHORT GAME.

OUTLOOK & STRATEGY:- Keep strict watch on the 4980 for downside & 5300 for upside & follow the break out.