THE NEW INNINGS HAS BEGUN
I am once again referring to the wedge pattern. You may recollect that, I had been giving warning of this drop for the last few weeks. After the breakdown, (see circled area), NIFTY is trending downwards. Now what can we expect in the coming weeks. My anticipation is graphically shown. NIFTY has an immediate target of 4050 (Swing "A" and First phase completion), after which it may retrace to around 4295 (Swing B). Thereafter a fall should take NIFTY to around 3655 (Swing C). This will complete the second stage of the drop. The 3rd phase of the drop will have a target of 2690. This is the dynamics I expect NIFTY to undergo. It is not a must that the third phase of the drop should happen; but that possibility cannot be ruled out and we have to be ready to handle that.
Looking at the charts of DOW, FTSE, Hang Seng and Nikkei (Not shown) It looks like NIFTY might go for the third phase too. However, the forthcoming budget "may" alter the direction of the Market for a couple of days but ultimately; it has to follow the world markets. Additionally, look at the Index Heavy Weight Reliance Industries (Weekly Chart in the box). You can see the current weeks drop has a close below the lowest low of 4 weeks. It just spiked below the sentimental level of 2000 and "Somehow Managed" to close above it. If it sustains below 2000, you will really feel the heat. Is it not convincing to you that a new innings has begun?
