1. We could label the down move from 6339 as a A-B-C correction. A was 6339-5177, B was 5177-5944. C could be sub divided into Wave 1 5944-5196, wave 2 is ongoing. Wave 2 could be subdivided into A from 5196-5705 and Wave B may have started. Assuming it is Wave B of 2, targets could 5511, 5451 and 5390.
2. Taking time into consideration,
Wave A = 6339 - 5177 = 1162 points (74 sessions)
Wave B = 5177 - 5944 = 767 points (39 sessions)
Wave C, Wave 1 5944 - 5195 = 749 points (50 sessions)
Wave 2 has lasted about 10 sessions so far.
3. The short terms stochastic have given a sell call.
4. The Bollinger Band has been touched on the upper side which is first indication of a sell signal.
5. The trend line joining the tops of 6339 and 6151 was touched at about 5705 and we are seeing a reaction from those levels.
6. The 50 EMA at 5518, the 200 EMA at 5575 and 20 EMA at 5491 should be supports for this correction.
7. Gold has given a decent dip and this is an excellent buying opportunity to buy UTI Gold ETF at about 2100 levels. It has corrected about 100 rupees from its top.
8. The Global problems are still not over. QE-2 has ended and the Greek Debt rollover has just postponed the inevitable. Use the rally to pare the longs.
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