Nifty update for 28th Nov - 2nd Dec 2011

As i told Nifty gave some good bounce backs during 21st -26th November and is expected to continue to bounce back till 4860 - 4930 as long as the 52 week low of 4630 holds as the bottom. The downward channel actually ends at around 4500 levels and it shows that there would be some more downside left for the market. Fibonacci number says , if we join the levels of 5330 and 4630 importance resistance levels would come at 4930-40 and 5000 levels. Price levels have formed a resistance at 4860 where lot of short positions are still there. Rollover data shows that short positions are still very much active at 4860-4900 levels.Thus play any bounce till these upper bands and be cautious on the long side. I would be a seller from the upside at 4860 - 4900 if it is showing a topping out formation. Pharma stocks are still giving lot of momentum on the upside and equity players could actually play those stocks on the long side as a defensive sector.It is better to avoid metal stocks as it is making new lows every day. One major worry for Nifty would be Reliance not participating in the rally. As of now for the week let 4630-4860 would be the range and on the range break out it would be extended to 4500 - 4940 on the downside and upside respectively.
Time cycle is telling you that Nifty should spend some more time in the downward channel or in the consolidation phase to balance with the time factor.Next important date for a crucial movement would be around 20th of December 2011.