AUTOMATED TRADING

AUTOMATED TRADING

22 May 2012


Market opened positive but it was a disappointing end to a session which traded with a positive bias until noon after which the market turned nervous and gave up all its gains due to record weakness in the rupee. Heavyweights tumbled pulling the Nifty down below 4900 where it closed. Sensex shut shop at 16026, down 156 points and Nifty at 4860, down 45 points from the previous close. Nifty future open interest increased by 2.75% today. 4900 call added 677200 contracts in open interest and put decreased 141550 contracts. As per option data I told you that we will see volatility around 4900 level. I have been bullish since 10 days but market tasted our patience ultimately. I  had a view that market will recovered from around 4800 level. It recovered but it could not sustained above 4930 level and failed. lets consider charts once again. I have posted below 15 min charts with elliot wave analysis. Currently we were falling in wave A from 5630 which end at 4788 and  from 4788 if my count is right this wave should go to 6000 level. It doesn't mean that it will go straight from here. On 15 min charts day before yesterday move was a rally of "B" wave, small subwave take this rally up to 4956. and from 4956 a correction has happened to 4849 level.and from 4860 which is closing price a up move should come in coming days upto 5100 level very soon. Remember our expectation is that we are in for a bigger up move.The second wave usually  retraces deep but it should not go below wave 1 starting point (4788).  In general all would be thinking that this rally will not sustainable because rupee hits life time low at 55.44, but technically the story is different. Nifty moved from 4788 to 4956, 167 points. today it fell to 107 points which is 61.8% feb. level therefor another up move will happen very soon which will take nifty upto 5100 level. Another interesting thing is that if market reversed from here(4860) it will form a HEAD AND SHOULDER PATTERN on 15 min and 30 min charts. Now lets a glance on FII activity today. FII bought 863 crores in derivative segment.They have bought 572 crores of index future. Why FII bought after long time in market here when rupees is hiting all time low. Something is cooking my dear.If you are long don't worry untill nifty hold 4788 level.
WARNING BE READY FOR BIG UP MOVE.
ALL ABOVE ANALYSIS WILL TERMINATE IF NIFTY BREAK 4788 LEVEL.
CLICK ON CHART FOR ENLARGE VIEWS.

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