Stock Markets have closed at the Highest Weekly Close level of 2013 and are quite near to Yearly and all time Highs. Lets check out the probabilities at this stage-
1. Probable Scenario
We may be trading in a treacherous sucker B wave that started from 5119 level. It has now done its minimum on crossing of 6142 pivot. It can extend to 6335-6500 level as calculated in chart below. This B wave may give a false bullish impression by crossing historic and important price levels only to deceive in a C wave down.
The short term chart also gives a similar insight, that the leg up may exhaust from here or extend to the target zone mentioned above on a close above 6200 on daily basis.
Here is an interesting data set that compares the Nifty 50 stock prices at the Nov 2010 level, which was the previous Long Term High and of Now. It is reproduced from the blog of Mr. Sunil Saranjame - The Indian Market Monitor
As of now it substantiates the Probability discussed above.
2. Alternate Scenario
a. Monthly Chart :
It throws up a very Bullish Probability.
b. Weekly Chart:
The sub waves of the above count shown in the chart.
- Short Term Trend is Up . Medium Term Trend is also Up but with waning momentum.
- The current leg up from 5701 can end abruptly near the top made as of now or can extend to 6335-6500 zone if 6100 is held on Daily closing basis.
- Close below 6100 may signal a short term Top in place and below 6030 the downtrend may accelerate.
- Caution is required for the Longs moving ahead from here and take the super bullish calls for 7200 level etc with a pinch of salt as of now.
- Alternate Bullish Probability to be considered only on a Weekly Close above 6350 level.