BUDGET and MARKETS – Nifty!

BUDGET and MARKETS – Nifty!

By Waves Strategy Advisors. For more information visit www.wavesstrategy.com or write to helpdesk@wavesstrategy.com

Budget was a non event for us since the trend which was originally down resumed as soon as it was over!

We mentioned in previous update on 27^th March 2013, “On account of Budget there can be increase in intraday volatility but the closing will be important. Events can produce short term spikes or change of trend but that will be only momentarily and the major trend eventually resumes. In short, the trend continues to be down with important resistance lying at 5850 on closing basis and any move back below 5750 will indicate that the short term consolidation is over and the downtrend has resumed.”

The last bar shown in below chart clearly explains what happened on the day of Budget…

Nifty Weekly chart:

Wave Analysis:

Following is a part picked up from “The Financial Waves” equity research report published today morning before equity markets opened..

Nifty had a gap up opening of around 40 points on back of strong reversals on upside in global markets. The high made during the day was 5849.90 which was to the point of the resistance of 5850 mentioned before. If events or external events would drive the prices then such respect for important levels would not have happened. Markets started moving down during the budget session itself and the major trend which is currently down resumed a little while after Budget was over. You might see headlines in today’s newspapers mentioning that “Budget fall short of expectations” which spooked the markets but Budget was over by around 12:50 pm and market was still in minor green by 1:14 pm. If Mr. Chidambaram was responsible for no clear steps to induce growth and reduce deficit then there should have been sharp fall by the end of Budget session. However the selloff was seen after a delayed time which was nothing but resumption of original trend. Case in point: It is the perception and social mood of the crowd collectively that moves the market and Elliott wave helps us to evaluate the probable paths we can expect.

Currently, prices made a low of 5672 on intraday close to the first target of 5650 we have been mentioning all the while. An important thing to observe is that each of the falls that made into the 100 points list has been increasing. For momentum to slow down we would expect the size of the bar should reduce but we are seeing increase in the momentum and price range on downside. Yesterday’s fall was one of the biggest on intraday as well as closing basis. This indicates that ……….

Our subscribers have been able to catch the entire move right from the top near 6050 – 6100 to current levels of 5675. There is still more to it. You can take your own informed decision by looking at the charts and explanation given in the daily research report “The Financial Waves”. For more details write to us on helpdesk@wavesstrategy.com or visit www.wavesstrategy.com reach us at +91 22 28831358 / +91 9920422202.