Market Analysis With Megh Mody

Daily spread chart Lead and Zinc has been moving in sync but from few months the correlation has been negative as Lead is moving up but zinc is failing to show strength. This can also be interpreted as Zinc is possibly forming a basing formation and is on verge to reverse the trend so that to be in tandem with the other. In short, Lead is showing strength but zinc is not, the trend for zinc can change which will make a positive correlation going ahead.

Bitcoin hourly chart Bitcoin this month till 13700 levels but it was short lived as prices then broke 10000 levels and ended in 4 digit number. However it seems that it wont go below 9000 in near term but can definitely conquer 13000 in medium term. From wave perspective, prices have completed (a-b-c) pattern in flat this can be wave a at one higher degree followed by wave b up or one correction is done and prices will resume the uptrend with wave iii higher. I am open with both possibility which suggests that prices will advance. In short 9000 is my support, as far as it is intact 13000 and above is what I am expecting.

Double top is a reversal pattern and Retracements helps to identify support and ressitance. Check out the criteria to identify a double top patter. Click on https://youtu.be/LO3wmOOPR34

Nifty Small Cap Nifty Small Cap is finding support near its previous low which indicates that the downtrend is not dynamic and prices are all set to move higher finding support from the lows. The important support of 5600 will be crucial. The second best support will be at 5900 levels.  As far as 5900 is intact prices can move up till 7100 levels. The level of 7100 will be achieved in a dynamic move as it will be in wave iii (impulse wave). This wave iii is likely to be an extended wave.  In short, Small Cap stocks are in focus as prices of an index can soar till 7100 with support of 5900 levels over medium term.

Nifty Daily Chart In my earlier update Nifty, I had mentioned that Nifty will continue the downtrend till 11400. However, this seems to now fade away as the index re-entered the falling red channel as shown in the chart. When prices re-enter the channel or a trend line, it possibly makes the bears short squeeze their position which results in a rally, taking prices higher. The index is also trading in a support zone of the exit poll gap (shown by two horizontal lines). As far as prices remain above 11450 levels it is possible that it can reverse the direction and move higher. As per Elliott Wave theory, prices might have completed wave c down at 11461 levels and has already started another leg up. This leg can go up till 11700-1800 levels. For this level to remain intact it is imperative that prices should not break 11450 (closing basis).

DLF Daily Chart DLF is moving in a sideways pattern in the range of 170-200 levels. In the above chart I have drawn two trend lines joining the two tops and two bottoms, by doing that the two trend lines eventually converge making an apex. This pattern is called as a symmetrical triangle pattern. A triangle pattern can be a continuation pattern or a reversal pattern. In this case with help of advance technical analysis I have come out with a conclusion, that it will be a continuation pattern. Advance technical analysis i.e Elliott Wave indicates that a triangle normally forms in wave b or wave 4 or in a complex correction. After forming wave c at 140 levels, the stock rallied near till 205 levels and formed wave a thereafter it formed wave b in a triangle pattern. The next leg of wave c up is pending. In short, DLF will surge going ahead which can take prices near till 210 levels in near term with support at 175 levels.

Nifty Anticipated on 7th July 2019 Nifty Happened on 8th July 2019 In my previous update on Nifty: Wedge Break I had mentioned that "  Nifty is in a bear grip and can witness selling pressure in coming week dragging prices lower till 11600 in near term." Nifty faltered more than 250 points in a single day and tanked below 11600- Anticipated Happened. For detail of the above analysis click on this link:- https://www.marketanalysiswithmeghmody.com/2019/07/nifty-wedge-break.html Nifty on the following day consolidated and made a candle which seems to be a reversal pattern i.e today on 9th July 2019. However, it is difficult to come to a conclusion that Nifty will reverse as it is important for a following day confirmation. If you want to catch a reversal, it is like catching a falling knife. The resistance will be at 11700 levels which is difficult to cross. On the downside 11400 will be a support as the index is on the brink to fill the exit poll gap. From W...