NIFTY still have some room on upside, a higher high above (18,707-18,722) would complete 2,price patterns. Once we get that higher high MARKETS then would require to break (17,484) for a breakdown. Watch out for (17,484) as a short term support on spot. TIME wise today and tomorrow would be very critical for INDIAN MARKETS tomorrow in final 30,minutes there would be an INDEX rebalancing which at times could trigger nasty price moves. Closer to (18,750) NIFTY would complete important PRICE moves from lows of (16,828) (17,561) and (18,055) So that was a key reason I posted last FRIDAY that this rally on (NIFTY) could fall short of its record highs. The rise on (NIFTY) from MAY,5th low of (18,055) is very unconstructive based on few rules of SPACE and TIME analysis. Tough subject to put in, but lets see, watch out for given PRICE levels. NIFTY BANK patterns have gone more intresting, it has posted a new high yesterday. it is developing a very rare pattern which is still under process so let it complete that, for short term consider things to be fine as long as it manages to hold yesterdays GAP. stay cautious once that GAP is closed.

NIFTY have posted a new high for the month which should not come as a surprise. Yesterday we expected a decisive move to kick in either today or on MONDAY. Since supports were held there was this possiblity of an upmove. this rally should only be a 1,or,2,day affair but wait for market to signal that. Earlier I posted a Technical reason why NIFTY cannot make a fresh record high, that also has to be considered before we get more exited. So there is a fare possiblity that this rally should fail in mids of new highs. On NIFTY BANK I already posted yesterday lets give that more time to cross 44,152 on cash. We have now entered in june series and this series is known for good amount of volatility which provides decent trading opportunities. At least month of june wont be as dull as MAY

NIFTY needs no analysis the breakdown point continues to stay at 18,042. If people can make anything of this 300 point range since 28th,APRIL then its truly their skills because MARKET is doing nothing. The question which is now disturbing all traders is how long things can continue this way?. We believe MARKETS are reaching a terminal point in TIME CYCLES where they have to make a decisive move either tomorrow or next MONDAY. Would look forward for that. NIFTY BANK is more intresting. the rally here since MARCH lows is very strong , but its pausing at a very critical resistance of 44152. If it fails to go above that then, this PATTERN would go in history books for gann as well as ELLIOTT students. Lets give it some more time to cross 44,152 supports here are placed at 42,500 below 42,500 we would call for a higher degree reversal. Would discuss its consequences as and when that happens.

DXY finally seems ready to end its months long consolidation. After January we never felt like we really have to reconsider our BULLISH view here. 101 was a level which we strongly considered as a durable bottom. We finally got low at 100.79 this low we believe is a long term low holding which DXY in medium term could carry PRICE above 120. For short term 106 could be that level which would act as resistance, above 106 we should see fresh 52,weeks high which was at 114. We have been hearing on potential impact on $ if U.S. defaults on its debt obligations, few even claims that a U.S. default could crash $ and literally everything would end. We believe U.S. is not going to default, rest what happens, lets see.

$S&P;500; has been testing patience for all market participants, doesn’t matter what your individual view is, the PRICE action since early APRIL has been very choppy and narrow. For an INDEX trader such sideways market is very annoying. In our review here in late MARCH we focused on level of 3,900 as a critical support, but we also did not expected it to break 4,100 anyways markets took out 4,100 on 31st,MARCH which opened up few upside possibilities. “After that break of 4,100 on 31st,MARCH it took markets to travel 100 points after 7 long weeks” so if that is considered a breakout? Then it’s a very pathetic one to trade. Last Thursday when S&P cash went above 4,195, trading community went crazy on calling for a new BULL MARKET, but based on our limited understanding on MARKET structure that is not a case, at best ongoing consolidation is an extended pause in a market which is primarily in a down trend. We don’t want to go in detail of under performance of small caps and out-performance for tech, everyone is aware on that. Even though this rally is not going to change the primary trend we should be aware on the best possible level on upside which possibly can terminate this extended upmove. That level would be 4,325. On downside if S&P cash breaks 4048 markets would resume their fresh leg lower. So 4048 would be a critical level to watch. TIME wise 25th and 26th,MAY would be key CYCLE dates.

NIFTY have narrowly escaped the print of (18,042) today structure is pointing that sooner or later this level should break, but yes, until that break we would still prefer to wait before calling for next leg lower. We have convincing evidence that MARKETS have reversed but still, markets lately have been more stronger then our anticipation so that’s the only reason why we are Looking for break of (18,000-18,042) zone because below that no bullish probablity would exist. Lets see how MARKETS break this either with a Gap-down or during MARKETS? NIFTY yesterday have achieved the TIME equality of its rally from JUNE low to DECEMBER high. This according to TIME and SPACE guidelines conforms a significant TOP at (18,887) which as per rules is tough to break, without a print of (15,183) so new highs on NIFTY is not possible. Would be interesting.

SBI needs to register a lower low below 557 to resume next leg lower, all upsides since lows of 499 and 501 are so TIME consuming and very overlapping which unfortunately cannot be considered as an uptrending move. Once this breaks 557 it should test levels of 525 and 501 in coming days. SBI wont sink alone it would take down entire BANKING pack, watch out.

NIFTY was showing signs of exhaustion in past week, as we discussed on last Friday above (18,389) NIFTY certainly would struggle to travel, I also spelled out the reason for that. With todays move below (18,195) markets are getting very closer to an important REVERSAL point. The INTRADAY move below (18,000) or even (18,042) would mark a major REVERSAL which would signal an end of current rally from MARCH lows. I posted this earlier as well, once this REVERSAL is confirmed we are likely to vitnes a waterfall decline in MARKETS. I dont want to go in greater details of other CYCLES aspects but point which we need to understand is below (18,000) PRICE damage would be severe. If you think that MARKET has done alot in last 20,days then you really need to check MARKETS from the high of 28th,APRIL. There has been enormous PRICE consolidation in last 3,weeks not only in INDIA but in global markets as well. it’s high time that this consolidation ends in days immediately ahead. Last time when I said that MARKETS would test MARCH lows people misread that, I dont think that lows should hold, lets see where we end in june.

CANBK, has broken down below 45-degree-angle from its january high of 341. We certainly have that high as a significant top, very unlikely that gets taken out. Infact the swing high of 327 also seems difficult to break. STOCK is under-going change in its CYCLES, below 299 we already have got VIBRATION PATTERN breakdown whose targets are placed below 275 and 252 on cash in next few weeks. All P.S.U. BANKS are giving signs for 10-15% decline in coming days.

NIFTY is showing signs of exhaustion but this wont be sufficient to register a REVERSAL. This rally most probably would struggle to travel above yesterdays high of (17,389) yesterdays high was a critical Gann angle from MARCH lows. So either PRICE consolidates here for one more week, or it breaks (18,000) and registers a REVERSAL, there are only two possibilities going forward. Lets see, with which option MARKETS goes for? REVERSAL is imminent but there is no point anticipating it we have been sharing REVERSAL levels since mid APRIL and so far those levels are held, once that level breaks, within 4,weeks we should get MARKETS below MARCH lows, (18,000) is that level which once breaks move towards (16,828) should be rapid.