Nifty after US elections

Bottom Line: Nifty looks to have started next leg on upside in the form of wave 5. The following is published in our today’s research report “The Financial Waves short term update”. To view the complete report, write to us at helpdesk@wavesstrategy.com visit www.wavesstrategy.com

Event: US presidential election:

                                                      “The Best is yet to come” – Barack Obama

·President Obama won a second term yesterday as he was re-elected and he promised his thrilled supporters "that for the United States of America the best is yet to come."

·Indian Markets gained for the sixth straight session. The 30-share Sensex ended up 85 points at 18,902 and the 50-share Nifty ended up 36 points at 5,760. In the broader markets, the midcapand the smallcap advanced 0.7-0.8% outperforming the BSE benchmark index, up 0.4%.

·The next president will need to address a so-called fiscal cliff of more than $600 billion in tax increases and spending cuts that take effect in 2013. 

Nifty 60 mins chart:

Wave Analysis:

We have mentioned in the previous update, “On daily basis, Nifty has given 5^th consecutive blue bars that raise the odds that wave 4 correction is complete at the low of 5580. In short, our bias is positive on Nifty with 5680 acting as important level on downside.”

Nifty had a flat opening yesterday but prices managed to sustain above the previous day’s low. After the announcement of clear victory of President Barack Obama in US there was a synchronized up move in global equity markets including India as soon as the announcement was made. However as US opened with a big Gap down, European markets also closed deeply in red. Sharp selloff seen in US and European markets later in the day can result into a Gap down opening in Indian markets as well.

Nifty has now moved above the resistance zone of 5725 and closed at highest level in more than 1 month.

Projection for current wave 5 is at ……………………….. The reasons why this level will act as very strong resistance are ………….

To view the complete report subscribe to the Equity research report that shows not only Nifty short to medium term views including daily chart but also views on 3 different stocks that gives good opportunity and shows important support and resistance levels or visit www.wavesstrategy.com