FIIs What are they upto in India?

FIIs have been consistent sellers in the market and I am not talking only about the Cash market where they have sold net for Sept so far after a similar trend in August. The Index futures OI that I plot for FIIs [blue line] and shows a similar trend for much longer. FIIs were Max Long in Index futures a year ago. This year they did not add up that much and since June they are in exit mode.

Now positions came very close to zero in August and the markets bounced. Near Zero readings have caused market bottoms before, except in larger bearish trends when the Positions declined below the lower red line and FIIs were short in index futures. So either that is likely or FIIs will be pushed into buying again from here which could propel the market up like crazy. In that sense this is an inflection point.

IF FIIs keep selling then they will be going to the other side of the trade from Long to Short else they should start buying back. I have drawn a falling trendline from the June high and as long as the trend remains below it, I should think it is down. Starting Sept the blue line is falling again and not rising despite a rising market so they are not yet buying meaningfully.

 

The second chart which shows the extreme in Options OI in client positions as a % of the total. Look at the Red circles around all the tops since 2015. We are in the red zone again. What I do not know is whether large part of the decline will come this month or the next because of all the Put writing that has been done. But the upside should be limited on this indicator.

 

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

 

Copper & Copper MCX Technical Analysis

Copper is now close to ending a 5 wave rise from the June low. So a correction could quickly set in. The RSI at 84.40 on the daily chart is a high reading. 3.02$ is the first support on the say down.

Copper MCX

Copper MCX prices are at the fag end of wave v of 3 and overbought. 3=1 is much higher but given the readings we need to be open to a unexpected price reaction. The MCX chart shows the upper end of the channel at 457 and lower end support near 433 and 20dma at 426. The most recent swing low is at 442, so a move below 442 could be the first sign of weakness.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

Google – Where is it heading?

Google – or now better known as Alphabet, the stock has been in the long term 5th wave for a while. I would have liked to believe that it would be complete by now but as shown on this chart till the parallel channel support at 907 holds there is room for wave 5 of 5 up to 1050 to develop in the coming months

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

Commodity Technical Analysis

Aluninium MCX

Aluminium MCX prices attempted to go above 135 but have fallen back with a negative divergence on the RSI. The structure of the correction is probably more complex like an expanded flat, and we could see a dip to 129-128 range, the next support range.

Zinc MCX

Zinc prices achieved equality to the July July move. In doing so the last 6 days move is a 3 wave structure. So it is best classified as an expanded flat that can see a dip in wave c down to 191-90 as the next support zone.

GOLD

Gold is making higher tops and bottoms and the last swing low is at 1300 holding which the trend does not change. The only EW botheration is that all the moves up are overlapped. Yes it can eventually lead to multiple extentions and then we would be beyond 1500 in this move itself. But till we get a non overlapping leg watch the 1300 support as key, it is a little far, you may trail with the 20dma that is also at 1300 and rising. Last year when prices rose after a false break below the yellow neckline the overlapping move up failed to continue, lets hope that does not repeat as we get closer to the 2016 top at 1375.

SOY MEAL CBT

Soy Meal prices reached the lower end of a triangular support near 290 and started moving higher. Wave Z could be finally complete and wave 3 of larger degree could unfold for Soy prices after a long consolidation in wave 2. The upper end of the triangle is at 332 for a breakout.

Sugar NCDEX

Domestic sugar prices opened lower even as global sugar prices are showing signs of near term strength returning. However local prices have not followed global prices of late and therefore there is room to wait and watch the pattern in local prices which is still showing weakness ahead in wave C down.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

 

Bank Nifty & Euro Technical Analysis

Bank Nifty

The hourly chart of the bank nifty futures this morning shows that mostly we will head to 24580 completing a triangle before we see lower prices.

Euro

Euro is bouncing back in minor wave b and wave c down should be next. Prices should go back to 1.166 or lower.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

 

EURO, EURINR and USDINR Currency Technical Analysis

EURO

The Euro completed wave 3 up from the Jan 2017 bottom. Draw a trendline of the highs and project a reverse channel down for wave 4 potential. Wave 4 goes either to the wave 4 of lower degree near 1.166 or the lower end of the channel at 1.147 and rising. It can take up to a month to develop. Wave 4 can also be a time consuming triangle that does not go down as much but in a range till it touches the lower channel line that is rising.

EURINR

EURINR – Against my earlier count that wave 5 was complete it probably is doing that now. Prices have moved up in a channel and we maybe due for the first serious set back for the EURINR since it started the move up. This 5 wave rise should be wave 1 of a long term bull market and the coming correction wave 2 down. 23.6% retracement at 75 and 38.2% at 73.7 are the first two support levels to watch.

USDINR

USDINR retraced 61.8% in minor wave ii down at 63.85 and is finding support there. Holding this wave iii=i points to 64.60 next on the way up in what should develop as an impulse.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

 

US 30 Years Treasury Bonds & NASDAQ Composite Technical Analysis

US 30 Years Treasury Bonds

US 30 year bonds are still within retracements limits for wave II up, so while there is no change in the wave counts or view, wave II has gone up to 78.6% and wave III remains far overdue to start. The third wave in bond yields would see big jump in US interest rates and rub off on other bond markets around the world as well.

NASDAQ COMPOSITE

The Nasdaq stopped at the 20dma resistance, however we cannot rule out a 61.8% retracement to 6355 before wave 3 down starts. Not necessary but possible.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

Zinc, Crude and Corn Technical Analysis

ZINC MCX

Zinc daily momentum is in sell mode on daily charts. Prices paused near the 204 mark that can be a double top in wave 5. A move higher can mean that wave 5 is still extending. But till then we have made a near term peak that can result in a wave iv of 5 consolidation or a double top. Next support is at 191. A wave iv consolidation should not see us fall below 38.2% retracement near 193, so 193-191 are important supports, below which we could be in a larger decline or correction to the trend.

CRUDE MCX

Crude is forming a long term triangle in wave B. Wave E down is the final leg of the triangle and in it prices can test the lower trendline near 2750 before completing the pattern.

CORN CBT

Agro commodities are declining again in either wave Z or E on long term charts. I reworked Corn, to expect wave C of Z down. Wave B of Z retraced 66% and is a triangle and wave C=A goes down to 270. I was expecting a bottom near the 2009 low and we may test it once more near the 290 level.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

 

 

Where are Gold & Silver heading? Technical Analysis

GOLD

A key reversal day in Gold, when prices open Gap up and then sell off to close lower. This at 78.6% near 1322, of the entire decline for the second half of 2016. Also at the upper end of the rising channel shown on the chart. This bar pattern is a classic and so this resistance is important for now. The lower end of the channel at 1288 is the next support and we may test that Below 1288 we consider it a larger reversal but till then the odds should favor the trend higher.

SILVER

Silver Mcx prices stalled at the upper end of the falling channel from the 2016 top. Unless we breakout above 40400 we are completing wave X and wave Z down for silver will be the last phase of this decline. While it is not mandatory that wave Z go to the lower end of the channel again as wave Z can truncate earlier, it is open to it. The averages near 38650 are the initial support zone, and the lower end is at 34570.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd

Infosys – is it heading downwards?

Infosys has spent a lot of time in the initial subdivisions of wave 2 and wave II of 3. This weeks crack pushes it into wave III of 3 and we should be on our wave towards 3=1 near 735.

Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd