Nifty Sideways action!

Waves Capital (http://www.wavescapital.com/): Financial Edge Short term update - The below excerpt is picked up from Daily report of Financial Edge short term update which shows Nifty predictions on daily basis and what we expect prices to do over short to medium term. Write on helpdesk@wavescapital.com to subscribe or for more information visit http://www.wavescapital.com/.

Nifty 30 mins chart:

Anticipated on 1st March 2012:

Happend:

We mentioned before on 1st March 2012 “Failure of prices to give any followup rally confirms b wave formation as non impulsive. We are moving very well in the channel and so the current down move is corrective. As shown on 60 mins chart, prices failed to retrace the complete of previous wave i.e. c wave of second zigzag in lesser time and so current up move is an x wave and next move down can be in the form of sideways consolidation or triangle. The technical structure shown by Nifty as 1 day down by 150 points, next day up by almost 100 points usually happens when we form triangle patterns. This week we shall continue to see range bound movements with prices coming down again today or tomorrow and moving in a broad range of 5300 – 5450.

Any move above 5450 will increase the odds that the down move is complete and we can again test previous highs near 5620. However unless that happens we will avoid initiating fresh longs and getting whipsawed every other day. Please trade cautiously and in small proportions during such environment and ensure not to lose profits registered during trending moves.

In short, we are looking at range bound movement on Nifty between 5450 and 5300. Any move below 5270 will indicate downward leg has resumed and a close above 5450 will indicate uptrend has started. However latter looks a lower probability as of now and we shall start consolidating in a range!” BANG ON!!!

We have been able to capture the most difficult aspect of market – sideways action. It is very difficult to forecast a sideways action and sideways consolidations are emotionally and monetarily draining if caught on wrong sides during each leg of triangle formation.

We can continue this sideways action for first half of the week to complete remaining pending legs of triangle. Nifty shall then …………………

In short, it is advisable to keep trading positions low and ………...

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