What does Gann say about Nifty

Scenario 1:These angles would tell you where are the important support and resistance points. These lines look like simple trend lines but they are some angles which tell you the final resting places for Nifty. If we have a look at this chart it tells you that in the weekly chart Nifty is still holding that trend line and below that it would take Nifty to 4200-4300 levels. As of now these extreme levels are irrelevant as we are no where close to that. In the current scenario Gann angles say there is a well tested angle (which i have marked in red color) and currently it is placed around 5200 levels in the weekly chart. If it surpasses that level the next level appearing in the weekly chart would be 5600 on the upside.As it is the weekly chart 5200-5250 levels will be marked at the same angle resistance line and this angle could play as a resistance point for the current up move.Blow 4630 levels the angles are not offering any support levels and a fall could be extended towards 4200-4300 levels.
Scenario 2: If nifty is getting close to 5200 and the angle is in a upward slopping line it could offer decent support close to 4900-4850 levels as you see in the chart.Thus Nifty could form a higher bottom , higher top formation which is actually a bullish pattern for the short term.

Nifty update for 07th December 2011

It was a range bound session and Nifty is in a double top kind of formation near the Fibonacci level of 5100-5110. As long as Nifty does not move above these Fibonacci levels the double top formation is confirmed. We were in the second phase of the rally , ie; profit booking session but Nifty was bouncing back from the lows with lot of stock specific action especially Axis bank and SBI.Any profit booking session would be continued by a secondary rally to confirm the top. So if one has to go short he should get the top and otherwise it would be buy on dips market as i was saying through my previous posts(in the coming sessions too).Dollar Index was not ready to cross 80 + levels and that really helped nifty to get good buying interest. At these levels of 5050-5100 one should have a look at the premium with which Nifty is trading. As of now nifty is close to the maximum premium levels of 30+ where it is extremely biased towards the upside. Thus any decrease in the premium with an increase in volatility is a sign of short build up.Some short positions were created in nifty as volatility was on a rise.Poor turnover data shows that it was a profit booking session and all the up moves were with out much volume.The immediate support lies at 4930 levels and if nifty crosses 5020 levels on the downside with the same upside cap today's high is confirmed . Thus as of now 4930-5150 would be the range.