Nifty Page: 16-08-2012

Pre-Market View:


To me it looks a perfect point for the beginning of a retracement:

The upmove from 5033 seems to have completed a perfect 5 wave form with an extended 5th subwave:
1=5033-5150=117
2=5150-5078=72
3=5078-5218=140
4=5218-5154=64
5=5154-5387*=233 so far
i=5154-5246=92
ii=5246-5165=81
iii=5165-5377=211
iv=5377-5294=81
v=5294-5387*=93

And Hourly charts have shown negative divergence on RSI-14 as the top of RSI at 5387(if it is taken as end of 5v) is below the top formed at end of 5iii(5377).

What should be the Stop-loss for shorts created on the basis of above observations and in anticipation of a Corrective Retracement?
As both 5iii and 5v can not be extended,so 5v can not do more than 1.62*92=149=5444.
Thus stop-loss for shorts is 5445(Nifty spot)

And what would be the target if this Corrective Retracement comes true?
Golden Retracement=61.8%=218=5168
EW wise, Prechter says that the wave with an extended 5th gets retraced to end of the 2nd subwave of 5.
And 5ii ended at 5165 

Is it a co-incidence????

I would be deliberately avoiding intra-day updates and the Pre-Market View shall have rejoinders at EOD

EOD 16.8.2012:

The chart at EOD:

On comparison with Pre-market chart,one can very easily infer the following points:
1.Closing is below the Hourly channel;
2. MACD has given a disinct bearish cross-over;
3.RSI also indicating downward bias.

So it seems we have caught an intermediate top correctly and are on the correct side of trade from first day.
The Stop-loss for shorts which was at 5445(Nifty Spot) in Pre-market hours,should be now moved to today's high 5391(Nifty spot).
Target remains 5165.

SSR