Going by the earlier patterns we are likely to make a higher bottom if we want that the long term uptrend should be continued. If this has to be higher bottom then it should be above previous bottom of 4690 and I think it will lie somewhere around 4800-4850 as there we have trendline and channel supports there. SO ITS NOT THE TIME TO SELL AND PANIC, ITS TIME TO BUY STOCKS IN STAGGERED MANNER. Sustained closing below 4800 and breaking previous lows of 4690 will negate everything and every startegy has to be rethinked. Dont be overleverged.
PREVIOUS POST ABOUT NIFTY --- MUST READ.
Oct 2009, Jan 2010, Now May 2010....??? To see comparisons read this post..
Nifty View:
Now in May 2010 , yesterday Nifty has again broken the purple momentum line in the same fashion it did in Oct2009 and Jan2010. Assuming that this fall will also take care of Higher top Higher Bottom, I am expecting that this fall will be less than 11.6% ( previous fall). Lets say this time around 10.5%(going by the trend of almost 1% decrease in each fall) which will correct Nifty upto 4830-4860. And going by the trend of the no. of days Nifty took to complete each fall, 9( first fall Oct2009),23 (second fall, Jun2010).9+14=23+14=37days ( May 2010). Out of which we have already completed 18 days, so i predict around 19 days are there to make a bottom.
Oct 2009 ( Nifty made a new High).
2 MONTHS LATER.
Jan 2010( Nifty made a new high).
2 MONTHS LATER
APRIL 2010 ( Nifty made a new high ).
2 MONTHS LATER
July 2010 ( Will Nifty make a new High after completing the fall and finding a higher bottom in 37 days ????? )
Its only a sort of analysis I have attempted , the levels or days can vary a bit.
Have a nice trading day
Regards
Ankit
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