Nifty Page :5-10-2012

Disappearing Divergence on Daily chart:

Price action, which looked like falling out of smaller degree trendline,is now firmly above it.And 5 DMA which was looking close enough is now a distant price point--:

Fresh tops are likely.

5838 is very much on the radar.

EW labels:

This C is seen as a 3x3x3x3x3 Ending Diagonal wherein
C1=4770-5348
C2=5348-5033
C3 in play (again as a 3 wave form) from 5033 upwards
C3(i)=5033-5448=415
C3(ii)=5448-5216=232
C3(iii)=C3(i) meant 5216+415=5631(already done)
C3(iii)=1.236*C3(i) meant 5216+513=5729(already done)
C3(iii)=1.382*C3(i) means 5216+574=5790(already done)

C3(iii)=1.5*C3(i) means 5216+622=5838

EOD post
In view of freak trade, Nifty spot chart would not be very useful.
Most notable features of today's trade--apart from Enam Securities (mis)adventure-- were:
1. OPening was above yesterday's high and closing was below yesterday's low --so a bearing engulfing can be very easily concluded.
2. However we closed above 5DMA=5736 so can not conclude that bear play has started.

And I would now use Nifty Futures chart:

It shows today's downmove as a clear 3 wave form.

This 3 wave form may get converted into a leading diagonal but for that Nifty Futures Price has not to breach 5820.