Tips on Gold Waves Strategy Advisors Ashish Kyal 6th Feb 2013

Tips on Gold Waves Strategy Advisors Ashish Kyal, CMT 6th Feb 2013. For more information visit www.wavesstrategy.com or write to us on helpdesk@wavesstrategy.com

Nifty started the next leg on downside..ATR indicates strong trend to start!

Bottom Line: Nifty continues to test the next support near 5980 levels. A break below this will increase the selling pressure.

Nifty Daily chart:

 Nifty 60 mins chart:

 Nifty Vs. ATR

Wave Analysis:

We mentioned in previous update, “A move below 5980 should intensify the selling pressure and prices should move down in the form of wave iii. ….Break of Ending diagonal pattern can result into violent moves where prices normally retrace the complete pattern from where it started in 1/4^th or 1/2 the time. The starting point of this pattern is near 5600 which can be reached very soon.”

Nifty has been constantly failing to move in sync with Global markets. The strong rally seen in US and European markets in previous trading session failed to result into any meaningful rally in Indian markets. Nifty had a gap up opening of almost 25 points and prices made a high of 6038. However it failed to cross above the Friday’s high and started moving down making a low near the support of 5980 level.

From Time perspective, wave 5 took approximately 46 days to move from 5600 to 6110 which was touched on 29^th Jan 2013. So prices should retrace back towards 5600 in around 12 to 23 working days starting 30^th Jan 2013.

An important thing to observe is change in premium of Nifty Futures contract. Futures were trading at a premium of around 35 points as of Friday’s close which got reduced to less than 10 points. Also Nifty put options showed more increase in price compared to change in spot. This is a bearish sign from Derivatives front.

Prices have now closed below the 20 days Exponential moving average for 2^nd consecutive day which continues to indicate bearishness. Also the daily bars have been constantly failing to cross above previous day’s highs since the high was made at 6110. Advance decline ratio was at 1170 advancing against 1700 declining which continues to indicate weakness in broader market.

The third chart is of Nifty and Average True Range (ATR) of 14 days. ATR measures the range of market over past 14 days which is now near 50. This indicates on an average Nifty has a movement of 50 points. This does indicates that on an average on intraday basis Nifty is moving by mere 50 points. We can see that such low value of 50 was seen in 2007, 2008 and only once in 2010. Except 2010 when the move up on ATR was associated with move up on Nifty, rest all the times ATR bounced back from near 50 values resulted in steep down move in index prices. Looking at other technical tools we think this time as well the up move in ATR should be associated with down move in Nifty.

The wave counts over short term is little tricky and we are showing one of the probable counts on 60 mins chart with current move down in wave iii. However wave ii has taken lot of time compared to wave i and so current down leg can also be classified as a-b-c complex correction. Next few days of price action will clarify the wave counts. But either of the scenario indicates bearishness with latter being less steep compared to first.

Existing short positions can now trail their stops towards 6040 which is yesterday’s high.

In short, the trend of Nifty continues to be firmly negative as long as 6040 is intact on upside. A gap down opening below 5980 will intensify the selling pressure with next minor support coming near 5940 levels.

To view on daily basis where we expect Nifty to head along with stocks which provide good short to medium term opportunities subscribe to "The Financial Waves" research report by Waves Strategy Advisors. For more information visit www.wavesstrategy.com or write to us on helpdesk@wavesstrategy.com

Tips on Gold Ashish Kyal Waves Strategy Advisors CNBC TV18 5th February, 2013

Tips on Gold Ashish Kyal Waves Strategy Advisors CNBC TV18 5th February, 2013

For more information visit www.wavesstrategy.com or write to us on helpdesk@wavesstrategy.com

Nifty in a stealth bear market!

Nifty in a stealth bear market!

By Waves Strategy Advisors. For more information visit www.wavesstrategy.com or write to helpdesk@wavesstrategy.com / Call on +91 9920422202

Bottom Line: Nifty has given break below the wedge level and Sensex has broken the previous pivot low!

The following is a very simple chart with an important trendline shown in black. Nifty has broken a very important pattern.

Nifty 60 mins chart:

Wave Analysis:

Nifty traded in a narrow range during first half of the day but selling pressure increased as soon as the previous day’s low of 6042 was taken out. Selling pressure was more prominent on Sensexwhich was down by more than half a percent during closing.

Yesterday’s move below 6040 not only formed a lower high and a lower low candle but also broke the wedge pattern on downside as seen from daily and 60 mins chart. Sensex has infact broken even the previous pivot low of 19884 making a low of 19865.

If our wedge assumption is correct and the break has happened then ……..

20 period Exponential Moving average shown on daily chart has been working very precisely over past few weeks. Prices have bounced back after making low exactly near this moving average. Yesterday’s low of 6025 on Nifty was just a kissing distance away from this MA. A move below ………………

Bank Nifty gave final push up towards 12960 which should be a very important top and prices are showing very strong negative divergence. A move below ………. will break a very important low on the Bank index which has been an outperformer so far.

In short, Nifty broke the wedge pattern yesterday and ……….. Sensex has already broken its pivot support. A move below ………………….

Do not miss out this important juncture in Indian equity markets. Subscribe to the daily research report “The Financial Waves” that shows where are Indian markets headed from here. Positive news over past few weeks has failed to lift up market sentiments… The daily research report shows important levels, basic to advanced technical tools applied on charts that justify our bearish stand!

To know the next move of Nifty and other stocks subscribe to Equity report By Waves Strategy Advisors. For more information visit www.wavesstrategy.com or write to helpdesk@wavesstrategy.com / Call on +91 9920422202 

Tata Motors – A major topping process!

Tata Motors – A major topping process!

By Waves Strategy Advisors. For more information on daily research report that contains Nifty and 3 different stocks write to helpdesk@wavesstrategy.com or call on +91 9920422202. Visit www.wavesstrategy.com

Tata motors chart shows very interesting and crucial juncture. Prices have moved up on slower momentum on different degrees from short to medium term. A very important topping process is forming in this stock.

To know more such opportunities in stocks and the direction of Indian equity markets subscribe to the daily research report “The Financial Waves Short term update”

        “Reliance Industries results were above expectations but the stock made a low of 880 below the price before the result announcement. RBI not only cut repo rate but CRR as well by 25 bps but Nifty reversed on same very day and is trading below the levels before the monetary announcement.”

Do not trade on NEWS but use technical charts and think objectively!

Tata Motors Weekly chart:

Tata Motors Daily chart:

Tata Motors 120 mins chart:

Waves Analysis:

We have mentioned in the previous update of 21^st January 2013, “Prices are in the matured stage and moving in the form of wave E of 5. Loss of momentum on upside shown by momentum indicator price ROC (shown above in weekly chart) suggest that upside is limited and prices should not move above 345/350 levels”.

We have been very accurate in capturing the top for Tata Motors. Prices have exactly reversed from the upper trendline of the wedge pattern consecutive for third time and moved lower till the support of 285 levels. 

Momentum indicator price ROC exhibits strong negative divergence (shown above in weekly chart) and steep fall in the previous week suggested that prices have completed wave E of wedge pattern near 340 levels and started an impulsive move on downside. At present, it seems that wave ii has completed near 61.8% retracement of the prior wave i and started the next leg on downside in the form of wave iii as shown above in 120 mins chart.

In short, 315 will act as a strong resistance. As long as this level is not taken out on upside our bias is negative and once again prices could move lower till the support of 285 levels. Further, move below 280 will take prices even lower till the next support of 260 levels.

By Waves Strategy Advisors. For more information on daily research report that contains Nifty and 3 different stocks write to helpdesk@wavesstrategy.com or call on +91 9920422202. Visit www.wavesstrategy.com