Market Analysis With Megh Mody

Midcap Daily Chart Midcap stocks are positively poised at current juncture. From wave perspective prices tumbled in a three wave structure (a-b-c) and then changed the direction from negative to positive which I think will also be a three wave structure (a-b-c). The overall trend looks firmly bullish soaring prices to its all time high. In short, the index will rally further pushing prices higher till 21500-21700 levels in near term.

USDINR Daily Continuous As per the above chart USDINR have completed impulse wave (1-2-3-4-5) on the downside. After completing wave v which was a truncated, prices rallied and gave a bullish break in a falling channel. This is a sign of trend reversal. However, more confirmation is required for an positive outcome to emerge. Sustainable move above 64.8 will give an indication that prices are poised to rally near till 65.30-65.40 levels. Failure to protect the above mentioned level will negate the downside target. In short, expect prices to rise near till 65.30-65.40 levels in near future as far as the level of 64.8 is intact on the downside.

MCX Zinc (Daily Continuous) MCX Zinc was the best performer along with Lead last year. This year the metal had started moving lower due to profit booking and other fundamental reasons. Looking at the Technical chart, Wave counts have been plotted and I have come to the conclusion that MCX Zinc is moving in an Irregular flat pattern (a-b-c). In which wave b is strong, that means wave b had retraced till 161.8% of wave a  (shown in the chart). Currently prices are moving down in wave c. This concludes that wave c will not retrace complete of wave b i.e 199 levels. As of now 61.8% of wave a to wave b is completed, now the immediate supports is at 100% of wave wave a to wave b placed at 213 levels. In short, expect prices to tumble close to 215-213 support zone over short term. The bias will be firmly negative for this metal

MCX Silver Daily Continuous As shown in the Daily chart of Silver, prices have started moving lower breaking its previous day low and have also closed below both the moving average 50SMA (blue) and 20 EMA (red). This opens the possibility of short term negative trend. Wave theory suggests, prices are moving down in the form of wave g of bow and tie diametric. The current downfall is corrective leg and so it will continue to take its time to correct. In short, prices of this industrial metal will falter any time soon. The bias is firmly negative, expect prices to test 37000 levels over short term.

Nifty Weekly Chart In the above chart, Nifty is moving precisely in the rising blue channel. However, historically it is proved that whenever, the index reaches near to the resistance of the channel it has reversed and bounced from the support of the channel ( marked by arrows). In the recent encounter, Nifty crossed the resistance of the channel but from past two weeks prices dragged the index lower, thus re-entering it in the channel. This can also be termed as failed pattern. A failed pattern, is when prices gives a bullish or bearish break but fails to hold it. In this case, prices did break the resistance but since it has re-entered bears will be more dominant now. In short, Nifty can move down lower till 10000 levels or even lower.

MCX Lead Daily chart (continuous) After forming a higher high and higher low formation, prices have broken the rising channel (blue). This gives a bearish break in a rising channel. From Wave perspective, prices have completed wave c in an ending diagonal pattern after forming wave b in a triangle pattern. In short, the metal is expected to tumble further near till 155 levels where cluster of supports are placed.

MCX Nickel Daily continuous chart As shown in the daily chart of Nickel, prices are moving up precisely in a small blue channel. However, it is facing the resistance of the upper trend line of the channel thus consolidating at the top. There are high chances for prices to move down in near term at least till the support of the channel. Coincidentally, short term moving average 20 EMA (red) is also placed at that level. RSI have also exhibited negative divergence. From Wave perspective, prices are currently moving higher in the form of irregular flat pattern (a-b-c). In which it is in wave b which is bigger than wave a. very soon wave c on the downside will start. In short, Nickel will tumble to 840-830 levels in near term. Break of this small channel will infuse further selling pressure.