Thursday and Friday's decline in the Nifty appears to be a pullback. The trend is currently UP. If the Nifty crosses 4590 on the upside the uptrend will be confirmed and traders can inititate fresh longs. A break over 4730 which the Nifty has tested thrice and failed in the past will result in a massive short covering and taking the Nifty to new highs.
This is the ideal scenario on the upside.
If the Nifty moves sideways and continues to go down, failing to cross 4590, we might see some downwards momentum.
Overall, the trend in Nifty is UP over the medium and longer horizons. The DOW is bearish over the longer horizon. While a major correction in the DOW or Asian markets will always result in the Nifty correcting short term, at some point the Nifty is going to decouple from the DOW and other global markets and continue its upward trajectory.
Sunday, August 9, 2009
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