|
The candlestick pattern on the daily chart shows
a bit of a concern: unless the level of 5389 is
crossed the index may not show much of strength
and can even come down to consolidate. The bulls
appear quite indecisive and seem to have lost
their firepower quite a bit just after they
marched ahead the way they did the day before as
if there was no tomorrow.
After a lackluster show at the US market with
the Dow settling 16 points lower, Asian equities
are pretty much anemic in their movements this
morning with some of the markets being
marginally in the red as we write this Market
Outlook.
However, the Nifty PCR has inched up to 1.29
from 1.27; it is more on short covering though
as the Nifty Futures have seen a reduction in
open interest by more than 400,000 shares. The
Nifty VIX having risen by just 3 basis points is
showing almost the same picture that unless
there is a sharp rebound it would favor the
bulls by being close to its all time lows.
One thing, however, needs to be noted: after a
major move on the day before yesterday could
just be a pause. Thus, we should be vigilant
about the Nifty’s movement today and see if it
can clear 5389 decisively in the day’s trading.
A pitched battle, however, would be fought
around 5400 – 5420 since we have seen that both
call and put options of 5400-strike price are
very active in yesterday’s trading.
The same resistance levels hold: on the way up,
first deciding level is 5389, 5400, 5408 and
5418; on the way down, support exists at 5351,
5344 and 5329 before testing the crucial levels
of 5312 and 5298. And unless the Nifty 5280-mark
is broken, the bulls might stage a comeback even
if sell-off were to take place from higher
levels.
While the day’s bias is essentially one of
indecision below 5351 weakness begins and above
5389 strength resurfaces.
Rajat K. Bose |
| * |
All prices relate to the NSE, unless otherwise mentioned. |
| * |
Stop-loss levels are given so that there is a level below/above, which the market will tell us that the call has gone wrong. Stop-loss is an essential risk control mechanism; it should always be there. |
| * |
Book, at least, part profits when the prices reach their targets; if you continue to hold on to positions then use trailing stops to lock in your profits. |
| * |
Don't chase a stock, if you are unable to buy a stock because it hits circuit levels on successive days, don't buy that. |
| * |
The analyst and his clients may or may not have positions in the securities mentioned above. |
| * |
Trading involves considerable risk. Trade at your own risk to the extent you are comfortable. The analyst shall not be responsible for any losses incurred for acting on these
recommendations. |
|
