Nifty weekly update - 31st October - 4 November 2011

Finally it broke all the resistance levels and rallied to 5350 + levels . The up move was good , supported by all the major sectors and the turnover data proves that. It is hard to believe that market would find a top soon and it seems to be riding the rally to 5500 + levels. Anyway for the time being as a trader 5470 is the next levels i'm looking at. It is interesting to see whether nifty would take another period of consolidation to move to that level.There would be buyers on every dip in the market till 5250 levels. On the upside i think 5470-5500 level would be a decent level to think for and there is only a little chance for nifty to move above that with out a consolidation period.Ending of rate hike cycle would be good for rate sensitive sectors and some important time pivots are coming around November 21,26. Beyond 5500 nifty looks too much stretched without a consolidation phase . As of now we should respect the consolidation period nifty had for the past two months and there would be several up moves to prove that the consolidation period was good enough for a fresh up move. Even if nifty makes a corrective move to 5200-5100 levels it would give as a higher bottom formation if we join it with the lows of 4700 thus it proves to be a bullish setup at least for the shorter term. We had 5330-5350 levels above 5180 and now extend it to 5470 levels as a reasonable target. Turnover data shows that apart from fresh buying lot of profit booking could be seen in many stocks and lets be a buyer at dips than on the upside. Any corrective move or consolidation phase will make nifty in favor of bulls because they did not get much opportunity to buy as it was a huge gap up opening. New range for nifty would be 5250 - 5470 for the coming week.Let nifty consolidate and takes its own time for a fresh move on the up or downside,but in equity market start buying on dips