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The S&P 500 closes above 1200 and the Dow closed marginally higher at 11117 up by 25 points. This morning Asia is trading strong with almost all the equity markets climbing higher: among them Japan, South Korea and Taiwan are up by more than 1% while others are up between 0.20% and 0.85%.

The SGX Apr Nifty is trading at 5260 up by 28.50 points on moderate volume. Chances are we would see some buoyancy at the opening here when the Nifty opens for trade.

The crucial range for the Nifty today would be between 5218 and 5239, if the index were to maintain above this level then it would show strength and try to move up. Keep any existing short positions running only if the Nifty were to maintain below 5218 else there could be problems for the bears.

On the upside, 5257/58 and 5280 are two key resistance points to look at. Once the Nifty goes and stays above 5303 the bulls would once again be in firm control of the market. Right at the opening the first the range between 5218 and 5239 and thereafter the small range between 5253 and 5258 would matter a lot. If it stays above 5258 then there is very high probability that the supply at 5280 might also be absorbed.

The whole thing changes if the Nifty slides down below 5218 and stays there since in that case a test of 5187 – 5169 range would look like a high probability event. However, unless 5146 is decisively broken one should not start projecting downwards. In any case, as of now, it does not portend that in the short run there would be life beyond 5097 on the downside.

Rajat K. Bose