we are firm on the view that Nifty will pause here with a support of 5185 ...

Yesterday I passed message at YIM that market will pause at this level and some one  responded  that all channels are expecting for 5500 level..
so want to explain few technical reasons ...
Market traded in range on Friday after huge gap up ..
momentum paused already and range trading started  ...it is indication of stage 3 ( see at Bottom )

Nifty is trading below 200 DMA and in highly overbought zone ...no one will buy here...only forced buying  I mean short covering will be there...due to margin short fall ...

Falling trend line In Nifty  is intact and  it seems  that  we  will have to wait for its breaching ...

a big gap is lying there to be filled ...

more over now trader will start thinking about RBI rate hike and its effect on auto, realty and other interest rate related sectors and a jump from 5k to 5400 in Nifty will force traders to book profit and possibility of increase in supply is there ....
IT index too trdaing below 200  MA ..and profit booking is already started ..

Here are the four stages that stocks go through. This happens in all time frames whether it is a monthly chart, weekly chart, daily chart, or an intraday chart.

Ok, so I'm not the best artist in the world but I think it will serve our purpose here! What? You thought it would be more complicated that? My philosophy on the stock market is that if it is too complicated then it is just not worth doing. Now, we'll look at the characteristics of the four stock market stages. I promise it will be painless!

Stage One

Stage 1 is the stage right after a prolonged downtrend. This stock has been going down but now it is starting to trade sideways forming a base. The sellers who once had the upper hand are now beginning to lose their power because of the buyers starting to get more aggressive. The stock just drifts sideways without a clear trend. Everyone hates this stock!

Stage Two

Finally stocks break out into Stage 2 and begins the uptrend. Oh, the glory of stage 2!! Sometimes I have dreams of stocks in Stage 2! This is where the majority of the money is made in the stock market. But here is the funny thing: No one believes the rally! That's right, everyone still hates the stock. The fundamentals are bad, the outlook is negative, etc. But professional traders know better. They are accumulating shares and getting ready to dump it off to those getting in late. This sets up stage 3.

Stage Three

Finally, after the glorious advance of stage 2, the stock begins to trade sideways again and starts to "churn". Novice traders are just now getting in! This stage is very similar to stage 1. Buyers and sellers move into equilibrium again and the stock just drifts along. It is now ready to begin the next stage.

Stage Four

This is the dreaded downtrend for those that are long this stock. But, you know what the funny thing is? You guessed it. Nobody believes the downtrend! The fundamentals are probably still very good and everyone still loves this stock. They think the downtrend is just a "correction". Wrong! They hold and hold and hold, hoping it will reverse back up again. They probably bought at the end of Stage 2 or during Stage 3. Sorry, you lose. Checkmate

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