DX (Dollar Index) – Can it spill out the beans for India Nifty

24 апр. 2016 г.

DX (Dollar Index) – Can it spill out the beans for India Nifty.

(This technical story connects you to GBPUSD-cable, USDINR & India Nifty).

Since 2011 March, DX has travelled in an impulsive manner till March 2015 & since March 2015—it has been travelling into consolidation mode & appears to be shaping out a triangle pattern who’s C-leg is done.
So, any movement above 95.50- could show us the way that D-leg has started & shall travel atleast 98—98.50 where it shall complete 61.8% of the B-leg.
Now, if you flip this triangle –you will realise that we have similar pattern in GBPUSD (Cable) –both are shaping out triangles where GBPUSD is about start d-leg in downside direction which will be confirmed once pair moves below 1.42979

DX & USDINR Connection-
As DX is shaping out a triangle & getting support of rising trendline & about to start d-leg of the triangle atleast for targets 98—98.50 …similarly USDINR is taking support of rising trendline & we could see another upside leg if 65.95 is intact on closing basis & should not fall below rising channel in that case we can look out for 68-68.50’s zone as target.

DX & India Nifty Connection- Why One should be cautious at current levels:
India Nifty has travelled quiet impulsively since 6825 to 7980- technically 7980 has been the resistance in early Jan 2016 & Nifty broke 1000 points—same resistance was seen in Dec 2015 as well & what a coincidence –we touched 7980 just recently in 18—22nd April 2016 week as well- giving us triple top formation which suggest that we should avoid taking long positions & should wait for clear signals. Clear bullish direction will arise when Nifty closes above 7980 & most important mark 8000 (7515 is key support level)
It looks like we are done with 5 waves upside since 6825 but yes we still don’t have any confirmation of going shorts and In coming days we should be careful & keep a watch on Dollar Index- which is looking bullish
Now, If Dollar Index starts moving above 95.50---probably it can cause pain to Indian equities & spill out the beans for the same.
Regards,
Abhishek H.Singh,CMT