Nifty RSI oscillator is continuing with couple of negative divergences on weekly charts :: HDFC Sec

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Observation:
 Week’s action formed a bull candle with good volumes which indicates bulls are resuming their momentum; to
continue with the bullish bias we need follow through buying for at least one to two days.
 Hide and Seek game is being played by bears: technically index is placed with couple of positive signs - price is trading
above 21 Day EMA, formation of higher top has been witnessed and daily RSI is placed with neutral sign but major
important thing to be noted is slow development in price advance and three wave advances with complex structure
which indicates that index is still in the bearish phase. So far the counter trend rise has not formed any five wave
advance, this gives us clarity and price is clearly showing that index is in “wave b” up which is a retracement leg before
“wave c” down unfolds. Break below 8235 is an initial confirmation that “wave c” has begun for the target of 7960 –
7700 levels.
 As per our preferred wave count; index has completed the “wave v” at 8626; and it has started new falling leg from
the high of 8626. The initial fall witnessed from 8626 to 7960 is an internal “wave a” and the second rise from 7960 to
present level is “wave b” of larger degree wave. As per recent price development index has the potential to slide
down towards 7700 levels, this view would come under threat if index closes above 8550 levels.
 Price is hovering at 80% retracement level of last fall from 8626 to 7961, in “wave b” 80% retracement levels is more
crucial as most of the time it plays vital role.
 RSI oscillator is continuing with couple of negative divergences on weekly charts.

LINK
http://www.hdfcsec.com/Share-Market-Research/Research-Details/StockReports/3010795