Last week nifty opened at 4718.15 & went up to mark the high at 4800.50. It then kept on  moving south  to register the low of the week at 4608.90  & finally closed at 4624.30.Thus it lost 89.70 points over the previous week which is 1.85% approximately.

RETROSPECT: - Last week’s we initiated short position at 4685 on breach of 4715 with the stop of 4800 for the tentative target of 4450.

SENTIMENTS:- Apathy is the sentiment.No one wants to listen or analyse the equity market.Fund allocation is diverting to commodity, currency, bond market & others leaving the stock market as abodoned baby of investment world. Whatever little funds allocated are sitting on tight string of purse awaiting  FII fund flow in new year,3^RD quarter earning announcement,global euro settlement.In short perrenial participants are also extremely cautious.

ELLIOT WAVE THEORY:-  As explained in last few weeks we would analyse the wave count from 6338 (5thNov,2010) which suffice for our weekly insight. As the wave group are confirmed & stamped we would compact & integrate it with larger degree movements. We are labelling the 6638-5177 as the wave (A) OR (1) & 5177-5740 as wave ( OR (2).From 5740 it has been unveiling wave (C) OR (3) & on the chart below we have shown the internal lower degree wave count. This wave (C) OR (3) is exhibiting the 5^{th EXTENTION} within 5th wave EXTENTION on the downside. Failure to cross 4840, points for the bearishness. With each passing day the corrective ABC wave count is losing the probability percentage & last level is the 4353.On breach of 4353 we will negate the ABC wave count & stamp the downward impulse. Henceforth we will take the impulse down unless something very unusual happens. In the chart below we have given two alternate wave counts from the 5740 in green & red colour. As usual green colour wave count is either bullish or less bearish & red colour wave count is more bearish & less bullish. Both the wave counts calls for the bounce to 5000 & above but only after the bottom is established in the coming week in the vicinity of 4500+ 125.

               For the Bank nifty the top of 11451 on 8^th July, 2011 corresponds to 5740 of Nifty & essentially, the other wave structure of it is remaining similar. We do see 5^th extension within 5^th extension   wave unveiling from the 11451.We see bottom in the vicinity 7500+ 300  & then head for the 9000+.

CYCLE- ANALYSIS:- Last couple of week we had given the brief introduction of cycle analysis & our limitation in presenting the same. In spite of these limitations, within limited flexibility we had stated that cycle forces are down till 30^th Dec, 2011. As we stated in our  last report it has taken pause & the bottom has got extended from 30^th DEC 2011 TO 7^TH  Jan 2012.We see thereafter the cycle forces on upside till 28^th Jan 2012.

SECTORAL ANALYSIS:- We intend to analyse the AUTO sector for the week. On the down below we have attached the AUTO INDEX OF BOMBAY STOCK EXCHANGE. This index is likely to make an intermediate bottom in 7700-7800 range in the coming week. In our view it should bounce back to 8800 in one months’ time period. We advise going long for the gain of 15%.

JAPANESE CANDLESTICK:- Nifty as well as bank nifty has formed the DARK CLOUD COVER & BEARISH ENGULFING LINE respectively. This denotes further weakness to creep in.

CHART PATTERN:-  On the nifty weekly chart  a distorted HEAD & SHOULDER pattern is visible.However there is no clear cut volume confirmation.Traders should be cautious on it as it may fructify or fails & accordingly move the market.In the weekly chart it is just desceding down within the well defined downward channel.In last one year every rally failed to cross the upper line of down trend channel.As long as it is unable to cross, primary trend remains down.Last week it has broken the congestion formed in the range of 4650-5200 formed during the last 4-5 months & recaptured it quickly. We will consider this as still the contuation of congestion & consolidation but any breach below 4531 will be considered as break down & sign of increasing momentum on down side.

OSCILLATORS:-  Majority of the oscillators in the  weekly  & daily are clearly bearish.

STOCK-RECOMMENDATION:-  

(1)We  recommend a sell on TCS ABOVE 1250  with the stop above 1300 for the target of 975 in next 8 to 12 weeks.

(2)We  recommend a sell  on ADANIENT at  290with the stop of 305for the target of 225 & lower.

PULSE-READING:-   SOUL VOICE SAYS THAT MARKET PARTICIPANTS  HAVE TO BE EXTREMELY VIGILANT AS MARKET IS AT A CRUCIAL JUCTURE OF PRIOR TO A BIG MOVE.

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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