Dear Investors
Tuesday was the day of volatility. Markets opened with lower
Valuations and continued the downward journey till afternoon.
Nifty tested the low of 5857 and bounced back in late trade to
Higher levels of the day at 5906. Nifty closed the day at 5874
With good volume and a negative advance decline ratio.
Levels during the day:
Nifty: Open: 5876/ High: 5893 /Low: 5791/ Close: 5868
Sensex: Open: 19596 /High: 19626 /Low: 19306/Close: 19545
Advance: Decline: 1570:1286
What Next
As long as result season is on and expiry is due tomorrow,
Markets will exhibit extreme volatility. Once we are out of these
It may display some direction. World markets will give a
Positive opening but results during the day and roll over
Positions will keep Nifty moving in the range 5750-5909.
Volatility will be the buzz of the day. Till we finish expiry
There will be no directional move by markets so one has
To watch the proceedings carefully.
Levels to watch
Upward: 5889(19602)/5910(19678)/5952(19812)
Down: 5808(19358)/5740(19172) /5706(19039)
Technical View:
Pivot At: 5859 (19492)
Market has continued its journey in given range but
With volatile moves, on either side.
R1 (First resistance) @ 5910(19678)
R2 (Second resistance) @ 5952(19812)
R3 (Third resistance) @ 6012(19998)
S1 (First support)@ 5808(19358)
S2 (Second support) @ 5748 (19172)
S3 (Third support) @ 5706 (19038)
During last few trading sessions Nifty has moved in a
Tight range with a resistance at 5900 and support at
5720 level
Unless Nifty moves above 5950 with good volume and
Better advance decline ratio ‘on closing basis’ it will
Continue to exhibit ‘ranged moves’
If Nifty breaks the vital support at 5700/5990 then
It will head towards the all important level of 200 Day
Exponential average at 5611(18708)
To get in to a new high or new range of 6003-6115
Nifty has to clear the level of 5998 on closing basis
VXI (Volatility Index)
Pivot @ 21.67
As we are through the earning season and expiry next day
Volatility will be on rise.
VXI Has moved in an upward direction indicating a weakness
In Nifty during next few sessions.
Traders and investors should not create large positions on
Either side.
DMAs(Day moving averages)
20 DMA@5804(19332)
40 DMA @ 5626(18751)
100 DMA @ 5704(19025)
200 DMA @ 5738 (19114)
40 Day Exponential @ 5711(19031)
100 Day Exponential @ 5686(18954)
200 Day Exponential @ 5611(18708)
Nifty is moving above all the moving averages indicative
Of a strength in an up move.
In near term Nifty should not break below 20DMA@5804
And 20 Day Exponential @ 5711 on closing basis or
Remain above 200 DMA at 5738
Real threat to the on going up trend will arise if Nifty close
Below the 100 Day Expo. Average at 5686.
COMMENTS
Once again market has shown its ‘Resilience to fall’ below the
Lower end of the range 5700/5959.Nifty has resisted the 'Gravitational
force 'N' number of times
It has shown reluctance to move above 5940 also. All depends
On what takes a center stage
A)
Result season
Fed meeting conclusions
Expiry rollover
Inflation
AND
RBI Monitory policy
Results of the state elections
Rise in oil after elections (Domestic)
Political instability due to 2G charge sheet
Or
B)
Liquidity
Good monsoon fore cast
Beginning of new series
Looking at COMPARETIVE WEIGTAGE of the events and factors
One can easily say ‘we are headed down’.
The fear is not out of place but the amount of liquidity or say
Momentum is such that every ‘negative ground reality’ is
Suppressed.
The fear of fall on the basis of ‘Fundamental weakness’ is
Taking markets to the lower level of range while a small good
News and or Liquidity by FII and all those who are sitting on
Side lines create the hope of moving higher and higher.
This is the name of ‘Volatility’, all this has confused everybody,
Analysts, Economists, Retailers, HNI, DII and a panwala too.
So the effect is ‘Everybody is Flirting’ with market. There are
Daily up and down swings indicative of uncertainty and nervousness
In the minds of both, ‘Bulls as well as Bears’
Only time will tell what next…….. Or ……..watch
Today’s fed meeting on global side
Or
Some good results on domestic front
Reduction in Inflation
Or
Good monsoon
Political instability secondary to 2G
Or
RBI moving on expected lines of 25 bps rise in rates
And so on…. Nifty’s future depends on answers to all
These, till that time …….
Buy at Dips and Sell at Highs will keep Nifty ‘SHUNTING
IN A RANGE’ and retailers will observe the show from
Sidelines and
Speculators burn their fingers in volatile trades.
Choice is yours.
Market strategy
There are number of events in a day or two , it is better to
Keep away from markets till the ‘dust get settled’
If not
Day traders can keep stop loss at 5720 for all longs and
Book profit at 5920
Short traders can initiate fresh shorts at 5920 with a stop
Loss at 5998
Do not create fresh shorts unless Nifty moves above 5920
Or below 5850 (Day traders).
Long term investors can add to their portfolio at every fall
Up to 5660.
Stock specific
M&M
Sterlite
Sesa Goa
Maruti
SBI
BOI
ONGC
Polaris
Geodesic
Ador fonrech
SPIC
Gateway Distripark
GATI
Tutis tech
Celestial Lab
BOSCH
IMPRESSION
Thanks
Dr. Vasant Bele
All the views are personal , invest after consulting experts.
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