MARKET OUTLOOK

NIFTY UPDATES!!!

A strong bout of buying interest in IT and engineering heavyweights helped the benchmark indices move firmly into the positive territory during the final hours of trade. The BSE Sensex gained in the region of around 102 points whereas NSE Nifty was up around 28 points. While the BSE Midcap index lagged behind with marginal gains, the small cap index closed with 0.5% gains.
For today Intra-day, Nifty has a support at 5447 & 5413 and faces resistance at 5492 & 5526. Nifty above 5507 will set a target of 5526, 5544 & 5556. Nifty below 5428 will set a target of 5411, 5393 & 5379. Last trading action is mark as a Bullish candle with a small lower and upper shadow & thick real body. After a day consolidation Nifty has continue its northward journey and manage to form a new top. So Nifty sustain above 5478 can see up move till 5508, 5526 and 5556 in near term.
For Short term, Nifty has a support at 5406 & 5339 and faces resistance at 5491 & 5526. As we can see from above chart,markets is trading is a big channel Blue channel wherein facing resistances at upper end of the channel and support at lower at lower end of the channel. From Bse Sensex daily chart, it has completed both side of trend in which it has finished upper side by testing upper end of the channel (i.e. 18048) and ended downside by testing lower end of the channel (i.e. 15960). After
forming bottom, as per the tradition Bse Sensex has started moving towards upper end of the channel (i.e.18364). As earlier we mention in our report that as per market oscillators Nifty has the potential to crossover recent top (5478). Last session Nifty has hit new high at 5482. On higher level traders has to be cautious near 5526 to 5556 at these levels profit taking can be seen.
After last session high, Nifty continue its trading pattern of higher top and higher bottom on weekly chart indicates more Upside.
Now the question arise where is Nifty heading? Technically speaking, having a look at monthly chart Nifty has given a break out of upper end of the channel. Moreover as per Wave count, Nifty has rally from 920 (Oct. 2002 Bottom) to 6357 (January 2008 Top) is mark as Wave A. Subsequently, Nifty corrected till 2253 (October 2008 Low) which is 75% of the rally & even
64% cut from top. After taking support at 2253, Nifty did consolidated almost 6 months and with the recent high at 5453 Nifty has recovered 78% of the entire fall. However, as per moving average Nifty closes below 5122 on weekly basis will provide Negative Divergences and which will states that Nifty has start Sub-Wave B (corrective wave) in Wave C or up move continue.
As Long as Nifty stays above 5362 (Closing basis), we remain POSITIVE on Nifty.