Overall Picture for a Change

I am short on the Nifty, which I will cut and go long if the Nifty crosses 4849. When the markets are so fixated on what the Govts will do, then it is very difficult for any trader to make a profit. I can, however, take a look at some charts to take a view of what other assets are doing and then try and draw some conclusions from the overall picture. Without going into the details of the reasoning, here are my conclusions.

1] The USDINR could have put in a medium term top. I believe we could see a fall in USDINR to around 51.50 or even 50.50 levels in the near future. Even after that there is unlikely to be a surge to a new high anytime soon.

2] Gold has also put in a medium term top specially in Dollar terms.

3] Nifty uptrend (longer term view...my trading system is still short) is still intact as long as 4630 holds. We came very close to breaking it yesterday. If we manage to hold it then there is hope for a rally to 5100 or more.

Conclusions 1] and 3] point in the same direction. So does the top in gold. What does not gel with this picture I have just painted is the fact that the Euro still looks weak against the Dollar. Need some more time to assess that. Until then I am hoping that the Nifty remains below 4849 so that my short positions can continue to make some money. If it does not and actually crosses 4849, then I will hope that I am right about what I talked about today and that the Nifty actually goes to 5100!