BREAK OF CRUCIAL SUPPORT

Yesterday ,nifty broke the crucial support of double bottom formed at 4451 and gave a strong sell signal. Now for any bounce 4451-4475 will be strong resistance for any bounce back. Today's pivot and resistance is 4483-93 with support in the zone of 4381-4328 from where a technical bounce is possible....

WEEKLY TECHNICALS

Last week, Nifty traded in range of 200points, so the weekly range will play an important part in the psychology of traders. Pivot for this week is NF 4561 for target 4646-4675 with break out over 4715. Weakness will continue as long as NF trades below 4537 and break down below 4484-4475. Remember strong resistance of NS 3648 (sensex 15580) and support of double bottom at 4451-4453

WAVE of OPTIMISM

Yesterday, nifty moved up after making a double bottom at 4453 and there was no looking back after the strength test of NF 4548 was crossed. My analysis is that this wave has been moving up after making double bottom at 2273-2963-3300-3534 and now at 4451, so one can keep S.L.of 4451 for any longs now... however, surprisingly FII's have been selling stock futures and now index future though buying in cash segment...means they are fully hedged. Yesterday, Open interest in Index future dropped dramatically inspite of increase in price showing profit taking or cutting of longs... there is no sell signal so far. Today's pivot is NF 4545 with strength over 4579 for target 4620-4657 . .. in case of any profit taking support at 4523-4508.

SUPPLY ZONE

Yesterday NF could not cross 4578 and tested 4475 zone. For today strength is only if NF trades over 4548 with pivot being 4531 and support around 4510-4483. Break of 4483 can take it to 4443-4434-4388. Probably a top of this wave (4586-4092) is formed and break of NS 4450 can lead to deeper correction.

BULLS STILL IN COMMAND

Nifty showing negative divergence yesterday, corrected by sideways movement with bulls even after breaking 4475 area managed to close much above it. .... for upmove sensex has to close over 14931. The pivot for this up move is now NF 4515 and strength is over 4534. Targets for today could be 4566 with resistance at 4602. Side ways movement likely. ... If NF stays below 4561.. one can short with S.L. of 4578-4582.

LOOSING STRENGTH

Though Bulls are heading towards NS 4648 but the hourly charts are going in overbought state and showing negative divergence. Watch 14931 on sensex which needs to be surpassed. However trend is up as long as NF trades over 4515 for target 4561-4585 and strong resistance in zone 4602-4640 for this week. Any time trading below 4491-4483 will spoil the Bull's party.

HEADING TOWARDS RESISTANCE ZONE

Market likely to test its top of NS 4509.... will it surpass that needs to be watched. No shorts over NS 4510 as it may target NS 4648... weakness only below NF 4442. Today's pivot is NF 4434 for target 4493 and resistance 4515-32-52. Trade longs with tight stop loss.

CONTINUATION OF UP MOVE

Market likely to continue its upmove with profit taking around 4407-4418 if NS 4363 is crossed. Today's pivot is NF 4326 for target 4361-4386 with support around 4311-4286. NF has to trade over 4339 for target 4405.

EXPIRY DAY

Expiry day of settlement is likely to bring volatility. For today, NF 4252-4262 will act as a pendulum mean point for the market to swing either way. Support lies around 4222-4229 where the shorts were covered yesterday. No buy below NF 4208.

OVERSOLD IN HOURLY CHARTS

I had been writing 13500 level on Sensex and yesterday it came close to that level (13518) from where bounce back is likely. For today , NF is strong as long as it trades over 4159 for target 4203-4219. However, NF 4224-4234 will act as strength test ; over which the shorts are likely to be covered.