NIFTY FIFTY

[AMITBE]

Hello Amit,
The levels you have mentioned have been taken by a gap up opening. What would be the impact of these gaps.. does it show strength? or the gaps r not important as long as the levls are cleared.

Regards
Sanjay

Hi Sanjay and Shrikant...
Gaps are important and strange entities.
They can mean many things depending on what kind of confirmation comes along soon after.

Filling of gaps is a much debated issue amongst TAs, but largely the consensus is that gaps do create pressure zones for future price action, much in the way as vacuume creates inbound pressure.

One has to judge for oneself how far price action has moved away from a given gap for its filling to be plausible in the immediate term, if at all.
Surely there would be significant gaps that the Nifty left behind a few thousand points ago, but would it sound reasonable to now say they are still awaiting their destiny and fate? I don't believe so, except of course something unimaginable happened.

The gap opening today would likely meet its pullback is a strong possibility.
In the morning post this was written: Some difficult levels in the zone the Nifty is at now are 3651-3669-3687-3705 where there should be plenty of contest.

I'm still going with this outlook.
One reason for this is the inablity of the Nifty to wade strongly into dense territory for several sessions now.
Certain levels are given where daily density is seen. Today again the Nifty is struggling to hold above these levels.
The weakness referred to on Friday afternoon is this.
Also, this only points at near term softness only as the longer term outlook is just fine.
Testing supports lower down for strength is a regular technical syndrome and the same was mentioned this morning.

As of now, keeping above 3692 would help keep the advantage where should 3708 be tested again, the move would have the potential to also test 3710-3713-3716.

To the down it's important to hold above 3684, below which the Nifty could slip easier.
Supports then would be 3681-3678-3675-3672-3669-3666-3663-3660.

 

[AMITBE]

Im still persisting with a relative kind of weakness in the Nifty in congestion areas.
But for all this, its still gaining day on day for several days.

Still, observe the tops and bottoms, say for the last 15 days with the help of trendlines.
There is a flat-top continuation triangle of course.
Talking of rising and fallings wedges on the other thread, can this continuation triangle also look like a rising wedge.

A lot of small caps are now hitting upper circuits, and this is a happy sign or not is anyones guess.

Anyway and regardless, the only verifiable truth is keeping firm stops.

And to recap, the following major levels were written yesterday, above the last mentioned 3633 major level:

3651-3669-3687-3705-3724-3743-3762-3781.

Im still curious to see how 3633 plays out going ahead.

For the levels:

To the up the line is 3696-3699-3702-3705-3708-3711-3714-3717-3721.

To the down the line is 3690-3686-3681-3678-3675-3672-3669-3666-3663.
3660 and 3656 are critical levels to hold.

 

[gvnarendra]

Im still persisting with a relative kind of weakness in the Nifty in congestion areas.
But for all this, its still gaining day on day for several days.

Still, observe the tops and bottoms, say for the last 15 days with the help of trendlines.
There is a flat-top continuation triangle of course.
Talking of rising and fallings wedges on the other thread, can this continuation triangle also look like a rising wedge.

A lot of small caps are now hitting upper circuits, and this is a happy sign or not is anyones guess.

Anyway and regardless, the only verifiable truth is keeping firm stops.

And to recap, the following major levels were written yesterday, above the last mentioned 3633 major level:

3651-3669-3687-3705-3724-3743-3762-3781.

Im still curious to see how 3633 plays out going ahead.

For the levels:

To the up the line is 3696-3699-3702-3705-3708-3711-3714-3717-3721.

To the down the line is 3690-3686-3681-3678-3675-3672-3669-3666-3663.
3660 and 3656 are critical levels to hold.

hello amitbe,

The critical levels of 3656-3660 that you had posted held on very nicely and a very nice pullback is following it. Great going friend. it may likely go for new highs from here.

,
gvnarendra.

 

[AMITBE]

hello amitbe,

The critical levels of 3656-3660 that you had posted held on very nicely and a very nice pullback is following it. Great going friend. it may likely go for new highs from here.

,
gvnarendra.

Hi gvnarendra...yeah a great move once 3656 shouldered the fall so well.
So far so good.

But back to the acid test theme:

3697 is one level.

Then 3703 onwards the Nifty is moving into density again.
There the line is 3707-3711-3715-3719.

 

[AMITBE]

Hi gvnarendra...yeah a great move once 3656 shouldered the fall so well.
So far so good.

But back to the acid test theme:

3697 is one level.

Then 3703 onwards the Nifty is moving into density again.
There the line is 3707-3711-3715-3719.

And if 3719 gets knocked out, then time permitting, the Nifty could go on to test 3723-3727-3731-3735.
These are of course potential levels.
At 3717 now.

 

[AMITBE]

Yesterdays close certainly puts a strong case for strength.
And this is so, from my perspective, because for the first time in a few days the Nifty plunged into congestion territory with much conviction.
This is so even if its mainly been ONGC that did the trick.
Numbers run this game, and so closing in the midst of positive numbers is always a positive.
Momentum certainly gained.

Whether this was the start of a final thrust forward before a pullback in the near term, or a continuation move pitching the Nifty higher, is to be seen.
My data still points to another sharp move date coming up on May 12.
So, no matter how the Index performs today and tomorrow, Im going to remain quite light.

To do a ticker check on some major levels for the Nifty mentioned earlier, Im bringing them up again:

3633-3651-3669-3687-3705-3724-3743-3762-3781.

Yesterday the Nifty reached as high as 3725 along the ladder.
The close at 3720 is a tad below the 3724 rung, and in line to ascend higher.
Readers will remember the comments on two levels in recent times:
3493 and 3633.
Much drama has happened around 3493 already.
3633 is still untouched and I'm still certain this'll get its due at some point.
Going ahead, 3791 is a similar number.
Im watching for these numbers with interest along my study.

For the levels:

To the up the Nifty needs to clear and remain above 3735-3740 quite early in the day for an easier ride.
The line is 3723-3727-3731-3735-3740. Will take it up later when needed.

To the down, 3715-3711-3707-3703-3701. 3701 is an important level to hold.
Then 3698-3695-3692-3689-3686.
3677 and 3673 are strong.

 

[AMITBE]

To do a ticker check on some major levels for the Nifty mentioned earlier, Im bringing them up again:

3633-3651-3669-3687-3705-3724-3743-3762-3781.

Yesterday the Nifty reached as high as 3725 along the ladder.
The close at 3720 is a tad below the 3724 rung, and in line to ascend higher.

Well, to put another blue mark on another rung along the ladder, the Nifty tested 3743 in the opening moves.
The levels are being scaled well.

For the levels:

To the up the Nifty needs to clear and remain above 3735-3740 quite early in the day for an easier ride.
The line is 3723-3727-3731-3735-3740. Will take it up later when needed.

To the down, 3715-3711-3707-3703-3701. 3701 is an important level to hold.
Then 3698-3695-3692-3689-3686.
3677 and 3673 are strong.

As for the daily levels, 3740 still needs to be held.
Then the step-ups are 3744-3747-3750-3753-3756-3759-3762-3765.

 

[AMITBE]

Going into trade yesterday morning, it did seem as if strength had returned compared to the preceding several sessions.
As Ive written earlier, this strength like relative strength, and is not at all like say, the RSI indicator.
The notion of strength in my work is directly related to the show of strength in areas where much density is seen. This density area levels are given where ever they show up.

On Tuesday the Nifty had displayed such strength.
Yesterday it once again failed to push into the days congestion.

But today is another story, on the fundamentals:
The big RPL listing.
The Left parties leading in two important states and likely to win. (This of course has an important bearing on the policies at the Center.)
Striking down of the proposal to hike fuel rates by the Left allies.
Fed Rate hike.
Asian markets under stress.

Its going to be hot and sweaty out there.

The aspect of time in my work is another issue.
A few days ago on May 3, a warning note had been made here where a significant move was expected.
The Nifty had closed at 3605 the previous night.
The big move came, but contrary to downwards, the Nifty kept going up.
At 3754 this morning it is a good 150 points up from then.

Yesterday another note of caution was made here in the morning post.
That is for tomorrow, May 12.
The direction is anyones guess.

What Ive observed is, if such a day is crossed with strength then the underlying keeps going up.
Be quite cautious. Everyone is sitting on huge profits in this rally, so dont give it away.

The levels:
To the up is the line at 3759-3762-3765-3769-3773-3777-3781-3785-3789-3793-3797.
As can be seen this is a difficult line going in today. Things may change.

Supports are 3750-3746-3742-3738-3734-3731-3728-3725-3722-3719-3716-3713-3710-3706.

On the face of it, yesterday's session spells a strong closure, but even so, be cautious for now. Expect much volatility.

 

[AMITBE]

The levels:
To the up is the line at 3759-3762-3765-3769-3773-3777-3781-3785-3789-3793-3797.
As can be seen this is a difficult line going in today. Things may change.

Supports are 3750-3746-3742-3738-3734-3731-3728-3725-3722-3719-3716-3713-3710-3706.

On the face of it, yesterday's session spells a strong closure, but even so, be cautious for now. Expect much volatility.

At this point 3689 and 3694 are vital levels to hold.
The drop below this could be quicker.
3684-3679-3674-3669-3664.

To the up, should 3699 the lowest so far holds, the important levels to stay above are 3713-3717-3721.
Above 3723 and then 3732 strength would come back
This is subject to 3699 holding up.

 

[SGM]

Hello Amit,

Tomorrow is May 12, looking forwarded to intresting action as indicated by you in your earlier posts. Another intresting aspect would be the 3633 level also mentioned by you, it looks far away, or is it?

Maybe during the weekend you can throw some light on these things.

Regards
Sanjay