Last week saw a fierce battle between bulls and bears, and both have marked their LOCs (Lines of Control) very clearly.
As shown in chart, bullishness can continue only on a cross and close above 4760, and then 4800 (which is unlikely, in my opinion, but - who am I to predict). For bearishness to resume, Nifty needs to breach and close below 4570.
For the moment, it is best to behave like a stray street dog, and just follow whoever is likely to feed him!! In this case, at present, it is the bulls who are feeding us lesser mortals; and soon, it might be the bears. It is extremely crucial to keep an eye on the intra day moves and not get trapped in silly overnight positions.
If the above resistances work, and for some reason, Nifty closes close to 4620 - 4650 on any day, it will be advisable to close longs, and either go short or stay away; since it is likely that bears will attack the US markets overnight, and ensure a gap opening below 4580. If that happens, it will also cause a serious rising wedge breakdown, and damage the bullishness of our markets for not only the short term, but the medium term too.
One extremely intriguing happening is that although Nifty has been making smaller but higher tops, BSE Sensex has in fact been making LOWER TOPS!! So, also keep an eye on Sensex levels, 15956 and 16002.
I will certainly be extra cautious at the higher levels given above, and will strongly advise readers to do so too. In my humble opinion, the next sector that bears will look to attack is the IT sector.
Do not be a stubborn bull or bear, and just follow the master..............HAPPY AND SAFE TRADING........
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