NIFTY:  ELLIOT WAVE PATTERN FORMATION.

Nifty if we look at the chart from 4760 onwards is showing the pattern formation of Elliot wave and is just near the top of the wave Five and is expected to enter in the corrective wave a-b-c pattern.

Wave I : Nifty entered in Wave I from 4760 and tested the higher level of 5360 from where short correction was seen in the form of profit booking and II Wave formation. Wave I is the base of the further wave calculation. Wave I difference was 600 points and can be said as 100% base move.

Wave II : After completion of wave I at 5360 Nifty correcte4d and tested the lower level of 5030, where the fall was seen by 325 points and retraced by 54% of wave I. This retracement was near about 50% calculation on closing basis.

Wave III : Wave III started from the lower level of 5035 and move way beyond the top of wave I crossing the level of 5360 and tested the higher level of 5855 which was top formation of the wave III from where correction was seen. Wave III rise by 820 points and retraced by 136% of wave I which was near by 121.6% on closing basis.

Wave IV : Wave IV started from the top of wave III at 5855 and tested the lower level of 5555 level, well above the rule of wave I top and fall was seen by 300 points and exact retracement by 50% of Wave I following the retracement rule also.

Wave V : according to the Rule when Wave III is higher than Wave I by more than 100% wave V is shorter then Wave I and also smaller than 50% of the addition of Wave I and Wave III. Wave V rose by 505 points testing 6060 level and the rise was above 84% of Wave I which also followed the Elliot wave Rule.

Till now we have seen the completion of the Elliot wave Impulsive pattern from the lower level of 4760 to 6060 in the form of five wave and is currently showing the sign of entering in the corrective pattern in the form of a-b-c where it’s just showing the sign of entering and continuation of wave A. Following are the expectation of the further market movement with the past performance and level what can be expected in the corrective move.

Prediction levels in NIFTY in the form of A-B-C Pattern.

Wave A : As per the Rule of Elliot wave, Wave A is near by 100% or 61.8% of the last Wave V, if we calculate the same difference wave A can test 5750 which is 61.8% retracement of wave V where as can test 5555 level which is 100% of the wave V. my personal view is Nifty may test 100% at the level of 5555 because this was the same bottom which was formed by corrective wave IV and there after wave V was commenced. Wave A if we consider 5555 level which may correct by 505 points and retracement by 100% of the wave V.

Wave B : As per the rule wave B is 50% retracement of wave A, calculating 50% of wave A which is 505 points comes to 252 points where adding from the bottom of 5555 level comes to 5810 level nearby.

Wave C : Wave C as per me is mostly more than 100% of wave A, may extend by 121% or 161.8% of Wave A. I will take 121% retracement of wave A which comes to 611 points(505*161.8%) where by the correction may test the level of 5200 level . on other side if we calculate 161.8% of wave A (505*121%) brings to 5000 level mark where the corrective wave may get over.

When we calculate the rise from 4760 to the top of 6060 difference comes to 1300 points and calculating 61.8% bring to 805 points correction bringing the level of 5255 level in nifty. Validate the target of wave C by 121% bringing to 5200 level, lower level target of 5200 – 5250 is expected in corrective wave were buying is expected for uptrend.

WAVE	POINT 1		POINT 2		DIFFERENCE	RETRACEMENT
I	4760		5360		600	100
II	5360		5035		325	54% wave I
III	5035		5855		820	136% wave I
IV	5855		5555		300	50% wave I
V	5555		6060		505	84% wave I
A	6060		5555		505	100 of wave V
B	5555		5810		255	50% of wave A
C	5810		5200		610	121% of wave A

EURJPY Diamond Pattern Formation

The diamond top and bottom pattern "<>" consists of a broadening pattern "<" where the price range increases in height from left to right followed by a triangle ">" where the price range shrinks in height from left to right. A diamond top is distinguished by the price trend increasing before the diamond formation; in contrast, a diamond bottom is distinguished by the price trend decreasing before the diamond formation. A breakout move upward occurs when price penetrates above the downward sloping resistance line (the top slope "\" of the triangle ">").

Looking at the chart EURJPY which rallied from the lower level of 117.05 and has tested the level of 127.7 thereafter has entered in the range bounce trading. On higher side it is forming the Diamond Pattern where as per the above explanation is perfectly in the same line. It is just near the lower support trend line which is coming at 125.20 and sustain closing below the same will give a confirmation of the breakdown, as per the breakdown Bulkowski (2008) gives more precise breakout targets.  Formula and calculation to calculate the pattern breakdown is as follow.

Diamond Top Downward Breakout Price Target: Breakout Price - ((Highest Peak of Diamond Pattern - Lowest Valley of Diamond Pattern) * 76%)

Diamond Top Downward Breakout Price Target: 125.2-((127.7-123.5)*76%) = 122 immediate level

Considering100% fall can bring to 121 where as 161.8% comes to 118 in medium term

Counter trend if the support of 125.2 holds and price bounce back and cross the higher resistance level of 126.93 which is the falling trend line. Sustain closing above 126.9 will give a confirmation of the upside breakout and price will rise further in near term. As per the breakdown Bulkowski (2008) gives more precise breakout targets.  Formula and calculation to calculate the pattern breakdown is as follow.

Diamond Top Upward Breakout Price Target: Breakout Price + ((Highest Peak of Diamond Pattern - Lowest Valley of Diamond Pattern) * 69%)

Diamond Top Upward Breakout Price Target: 126.93 + ((127.7-123.5)*69%) = 129.8

Daily Bullions & Energy Report for 12th Feb 2013

GOLD:    Support: 1628 - 1638                                     Pivot: 1655

                   Resistance: 1664 – 1680  

Gold futures extended declines from Monday’s U.S. session during Asian trading Tuesday as technical pressure continued to build with the yellow metal languishing below USD 1,650 per troy ounce.  On the Comex division of the New York Mercantile Exchange, gold futures for March delivery slipped 0.31% to USD 1,644.05 per troy ounce in Asian trading Tuesday. Gold settled down 1.27% at USD 1,645.65 a troy ounce in U.S. trading on Monday. Gold futures were likely to test support USD 1,643.25 a troy ounce, the low from Jan. 7, and resistance at USD1,685.65, the high from Feb. 5.  Stochastic has given negative intersection just below 50 % zone and if failed to cross resistance of 1690 reversals in price may be expected to test 1640 – 1610 in near term.

SILVER:   Support: 30.38 – 30.66                                   Pivot: 31.09

                   Resistance: 31.37 – 31.80

Comex silver for March delivery dropped 0.35% to USD30.803 while copper for March delivery fell 0.07% to USD3.723 per ounce. Trade was quiet again today as markets in China, Japan, Singapore, Hong Kong, South Korea and other nations will be closed for all or part of this week due to Chinese New Year festivities. To this point in February, 1.2 tons of gold have been pulled from the SPDR Gold Shares, the world’s largest exchange traded fund backed by holdings of physical gold. 

Stochastic has given negative intersection just below 30 % zone and if sustain trading below recent low of 30.7 will bring some more selling where some more sharp correction can be expected to test 30 – 29 on lower side.

CRUDE:    Support: 115.90 – 116.60                             Pivot: 117.2

                     Resistance: 117.89 – 118.50

Oil futures fell modestly during Tuesday’s Asian, paring gains notched during U.S. trade Monday European Central Bank official said the euro wasn't overvalued. Meanwhile, Gulf members of the Organization of the Petroleum Exporting Countries are believed to not favor raising prices despite oil’s recent spike higher. Gulf OPEC members include Saudi Arabia, the cartel’s largest producer, Iran and Iraq. Saudi Arabia has previously favored keeping prices around USD90 per barrel to avoid demand destruction. OPEC accounts for about 40 percent of global oil output.  Stochastic drifted from the overbought zone and has been moving negative where if sustain trading below 117 will continue the fall and can test 113 level.

Daily Forex Report for 12th Feb 2013

EURUSD: Support 1.3326 – 1.3364                              Pivot: 1.3396

                   Resistance: 1.3434 – 1.3466

The euro was almost unchanged near two-week lows against the dollar on Monday as concerns over political uncertainty in the euro zone weighed and investors watched a meeting of euro zone finance ministers. EUR/USD hit 1.3412 during U.S. morning trade, the session high; the pair subsequently consolidated at 1.3374, edging up 0.05%. The pair was likely to find support at 1.3352, Friday’s low and a two-week low and resistance at 1.3478, the high of January 25. Earlier Monday, official data showed that French industrial production came in slightly better than expected, falling 0.1% in December from November compared to expectations for a 0.2% drop. Stochastic are trading below 20% oversold zone where support is seen at 1.3350 and trading below some more selling is expected.

GBPUSD: Support: 1.5540 – 1.5598                             Pivot: 1.5704

                    Resistance: 1.5761 – 1.5867

The pound remained lower against the U.S. dollar on Monday, as sustained concerns over the outlook for growth in the U.K. continued to weigh on demand for sterling.  GBP/USD hit 1.5703 during U.S. morning trade, the pair's lowest since February 7; the pair subsequently consolidated at 1.5713, shedding 0.54%.  Cable was likely to find support at 1.5646, the low of February 7 and resistance at 1.5810, the session high.  Last week the BoE warned that the economic recovery would be “slow and sustained” and “likely to remain muted in the near term” after it announced a decision to leave interest rates on hold at 0.5% and keep its easing program unchanged. Stochastic has given negative intersection and if sustain trading is seen below 1.5630 free fall is expected to test 1.5400. 

AUDUSD: Support: 1.0203 – 1.0231                            Pivot: 1.0278

                     Resistance: 1.0306 – 1.0353

The U.S. dollar traded mostly lower against its major rivals in what is looking like another quiet Asian session on Tuesday. Markets in Hong Kong, Shanghai and others across the region remain closed for Chinese New Year festivities. AUD/USD climbed 0.10% to 1.0266 even after reports that traders are increasing bets that the Reserve Bank of Australia will pare rates later this year. Some traders are betting on nearly 50 more basis points being shaved from RBA’s key overnight rate, currently 3%. Even a 25 basis point reduction to 2.75% would take Australian interest rates to a record low. 

Stochastic are trading just above oversold zone with negative intersection and if trading is seen below 1.0250 can move to test 1.0160 level on lower side.

EURUSD Forming a Bat Pattern Formation

From the above chart EURUSD is showing the BAT Pattern which is rare formation and is near to similar to the Head and shoulder pattern, just a difference is the Head is not above the shoulder and is below the both the shoulder which gives the BAT pattern outlook on the chart. yesterday after the sharp correction which we have seen from 1.2940 and tested the lower level of 1.2821 testing the support of 1.2820 and closing was near the Neck Line support as well. It is expected to have a gap down opening on Monday which will be below 1.2800 and will move further towards the expected support of 1.2610 and 1.2480 will be the target in near term. Only Closing above 1.2890 will hamper the bearish outlook in market. Trading Call : Sell EURUSD @ 1.2800 Stop Loss @ 1.2900 Target @ 1.2610 - 1.2480 in near term. Rajeev Darji +91-9820987859

Trading Hour Schedule for US Public Holiday in May 28th 2012

Trading Hour Schedule for US Public Holiday in May 2012 Instrument Monday 28th May FX regular hours EQs & ETFs Closed Index CFDs Europe 50 02:00 - 11:30 France 40 02:00 - 11:30 Germany 30 02:00 - 11:30 UK FTS 100 02:00 - 11:30 US SP 500 02:00 - 11:30 US NASQ 100 02:00 - 11:30 US DJ 30 02:00 - 11:30 Commodity Nat gas Closed Gold 18:00 Sun - 13:00 Mon Silver 18:00 Sun - 13:00 Mon US Crude Closed *All times in EDT

Daily Forex and Commodity Report for 23rd May 2012

EURUSD: Support 1.2550 – 1.2605 Pivot: 1.2710 Resistance: 1.2765 – 1.5870 Euro: The euro was down against the U.S. dollar on Wednesday after former Greek Prime Minister Lucas Papademos admitted that the country has crafted a roadmap to exit the eurozone although the possibility of such a risk isn't likely. In Greece, the country's financial stability fund approved a EUR18 billion capital injection for the country's four top banks, however, former Prime Minister Lucas Papademos reportedly told Dow Jones newswires the possibility of a Greek exit from the eurozone was a real possibility. The pair was likely to find support at 1.2641, Friday’s low and a four-month low and resistance at 1.2868, the high of May 15. This bounce is just a short correction in profit booking side where some range will continue to trade. Stochastic has drifted below 50% zone & down side rally will continue.

GBPUSD: Support 1.5670 – 1.5720 Pivot: 1.5780 Resistance: 1.5825 – 1.5890 Pound: The pound trimmed losses against the U.S. dollar on Tuesday, pulling away from a two-day low after positive U.S. new home sales data, but a previous U.K. inflation report and uncertainty ahead of a key European summit continued to weigh. As the expected support is broken below 1.6000 and trading below the same on closing basis will open the door for 1.5880 and the support if 1.5820 is also broken and next target is expected at 1.5620 level. – 1.5550 levels where 1.5900 will be resistance level. Stochastic has given negative intersection just drifting below 20 % zone and if failed to cross resistance of 1.5900 reversals in price may be expected.

AUDUSD: Support 0.9650 – 1.9710 Pivot: 0.9820 Resistance: 0.9880 – 0.9995 The dollar rose against major world currencies in Asian trading on Wednesday, after former Greek Prime Minister Lucas Papademos said Greece can't rule out exiting the eurozone, which sparked a flight to the safety of the greenback. The news sparked demand for the greenback amid a global risk-off trading session. As per the pattern breakdown below 1.0240 it has tested the level of 0.9860 some range bounce move is expected trading below the same will bring to 0.9660 level. Stochastic are still trading below 30% zone and has again given negative intersection where fall in price is expected to test the lower level of 0.9660 – 0.9400 where selling at rise is advisable.

Gold: Support: 1541 – 1554 Pivot: 1575 Resistance: 1587 – 1607 Gold prices dropped in Asian trading on Wednesday after investors rushed to the dollar on comments from former Greek Prime Minister Lucas Papademos the country cannot rule out the possibility that it could leave the eurozone. In Greece, the country's financial stability fund approved a EUR18 billion capital injection for the country's four top banks, Gold futures were likely to test support at USD1,526.95 a troy ounce, the low on May 16, and resistance at USD1,603.35, the high from May 9. If sustain trading is seen above 1605 it will move to test 1620 to 1355$ and will enter in range bound. Sustain trading below 1550 will bring to 1530 to 1515$ in near term. Stochastic are trading negative where downside movement is expected to continue.

Silver: Support: 27.4 – 27.74 Pivot: 28.25 Resistance: 28.58 – 29.09 Silver which reverted from the level of 31.42 where resistance was respected at 31.5$ and is trading below the support of 28.5$ and sustain trading below 27$ will continue the down trend where will continue in pattern breakdown moving to test 25$ level. Sustain trading below 27$ recent low will continue for 25 –23$ immediately where further 21$ and 18$ will be the medium term target. As it’s a rule after the breakdown short recovery can be seen from 25$ and retest the level of 28 and then continue the down trend for lower level. From current level we will continue the bearish view if trading is seen below 27$ will bring to 26.5– 25 immediately. Stochastic are trading in just traded with negative intersection where trading below 27.5$ has continue downtrend.

Crude: Support: 89.9 – 90.7 Pivot: 92.01 Resistance: 92.8 - 24 Crude: Crude oil futures fell in Asian trading on Wednesday on talk Iran is increasingly willing to open its doors to nuclear inspectors, which could ease sanctions on the country and pave the way to normal oil exports. Iran cut oil exports to portions of Europe to counter economic sanctions slapped on the country, and a European Union-wide oil embargo still remains set to take effect in July. Crossover below 91$ will brings to 90.3 – 89$ levels and may go further down, where as failing to cross the same and trading above 95 will retest 99$ level. Stochastic are in mid zone with negative intersection where down fall is expected