Nifty is currently facing resistance at technical levels of 5950. The current up move started from the lows of 4800, which was a intermediate bottom in May, 12. Since May of this year 2012, Nifty has traveled in a channel like formation, upto the current resistance levels of 5950 and formed a Doji like candle pattern three days ago.
Pls see the chart below:
From the chart above, one can notice several interesting things.
1. The upmove channel is still intact for Nifty, so this upmove can push Nifty to much higher levels.
2. However, the resistance levels are closely aligned now, so the next resistance levels are 5950, 6200 and 6350.
3. The current resistance level 5950 is also a Fibonacci level, of 76.4% retracement of entire move from Nifty's top of 6330 in 2010 to Nifty's bottom of 4550 in Dec, 2011. There are several other Fibonacci patterns visible in the chart above.
So, the current level 5950 seems like a interesting confluence of several things in parallel. Maybe Nifty will retrace a bit from here and touch the previous support of 5630, before it gathers enough steam to break next levels of 6200 and 6350.
So what's next for Nifty? Pls see the chart below:
With that view of retracement, one can take a Elliott view of the entire upmove from Dec,2011 bottom and draw the 1-3-5 as above. Currently we are at node 3, and it might retrace to Node 4 at 5630. Node 5, would be a big, bad, fast upmove and if length of line 4-5, is kept equal to line 3-4, final leg should be equal to approx 1000 Nifty points.
So eventual target of this leg 5 of upmove, can be 6500 levels for Nifty, achievable in year 2013 itself. Wishing you a successful year 2013.
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