WILL NIFTY CROSS THE HURDLE AT 5600?

                Last week nifty opened at 5490.05 & went down to mark the low at 5308.45. It then went up for the whole of the week to register the high of the week at 5563.30 to finally close the week at 5445.45.Thus it lost 93.30 points over the previous week which is 1.8%  approximately.

RETROSPECT: - Last two weeks we have not entered any positions due to budget & lack of clarity. This week we are watching 5690 as trend decider level & short the market at any rally around 5650 with  the stop of 5700.In case of decisive cross above 5700 we will go long.

SENTIMENTS: -  Negativism in the sentiments has certainly reduced with the  budget uncertainty behind us.However the domestic realigning of of political equation,middles east crisis, japanese eartquake-tsunami & boiling crude will keep check on  the positive sentiments.

ELLIOT WAVE THEORY: -  Last week we had shown two alternative wave counts from the top of 6338 in green & black colors & reported that black color wave count is as good as  negated with probability below 10%. However the sharp rally of last week  has revived the black color wave count but still with the lower probability. Till the nifty crosses decisively above the 5800 black color wave count will remain lower probable wave count. For the coming week we will  watch the 5690 level closely. In case 5690 is not crossed & nifty starts descending down then it will be clear bearish case. In case it crosses the 5690 but do not go far beyond 5750 then again it is the bearish case. Only decisive cross above 5690 & reaching above 5800 will establish the bullish trend.

 On the shorter term chart we have taken the 5177.70 as starting reference point. We have shown two probable wave count in green & black color. The green color wave counts essentially portrays the FLAT corrective pattern in Elliot wave theory. This we are taking as high probability wave count as the momentum in rise from 5232 is lower & waning compared to rise from 5178.Essentially for the same reason black color wave count is assigned low probability. However if it picks up the momentum & reaches around 5800 then it will become the high probable wave count. In the next two days this dilemma should get resolved.

SECTOR ANALYSIS:- We intend to analyze the BANKING sectoral index.In our view it has completed the major leg of downside correction & we are expecting the bounce on the upside.This has been further supported by the positive divergence in stochastics indicator.We recommend long positions at 10800 for the target of 11200 & 11540.

JAPANESE CANDLESTICK:- In weekly chart it has formed the BEARISH HARAMI PATTERN.This is bearish & would look for confirmation in the coming week.

CHART PATTERN:-  There is no significant chart pattern visible.

OSCILLATORS READING:-  The daily RSI,STOCHASTIC & MACD have  turned up from heavy short sold level. In the weekly chart oscillators are down indicating the medium term too has entered downtrend.

STOCK RECOMMENDATIONS:-  We would recommend buy on following two stocks as buy against the contra trend strictly from the short term perspective only.

(1)Buy M&M at 660 with the stop of 645 for the target of 710.

(2)Buy ITC at 172 stop 170 for the target of 182.

PULSE-READING:-  JKD SOUL VOICE SAYS TRADE ONLY IF YOU CAN SWIFTLY MOVE IN & OUT & DO NOT HESITATE TO EXECUTE STOPLOSSES.OTHERWISE WAIT TILL THE LIBYA CRISIS & CRUDE COOLS DOWN.

OUTLOOK & STRATEGY:-  WATCH THE 5690 CLOSELY.RETURN PRIOR TO 5690 IS CLEARLY  IMMEDIATE BEARISH.TOUCHING 5690 BUT NOT CROSSING 5750 INDICATES BEARISHNESS AFTER SOMESIDEWAYS MOVEMENT.BULLISH ON CROSS ABOVE OF 5800.WE WILL TREAT 5800-5550 AS TRADING RANGE & BELOW 5550 BEARISH.

THIS IS THE PORTRAY OF GENERAL BROADER MARKET VIEW WITHOUT ANY SPECIFIC STRATEGY & SHOULD NOT BE CONSTRUIED AS SPECIFIC CALLS.FOR THE MORE POIGNANT VIEW ON MARKET,WINNING STRATEGY & PIN POINT TIMELY PRICE LEVEL CALLS, CONTACT US  TO SUBSCRIBE FOR OUR PREMIUM SERVICES.           

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