Yesterday, NIFTY made a Short White Candlestick Pattern, which resembles the formation of High Wave Candlestick Pattern. The pattern implies a loss of sense of direction and that there is a great amount of indecision in the market. NIFTY breached its crucial and physiological support level of 5400 for the second Trading Session, in Intraday Trading by making a low of 5367.45. NIFTY had a very flat opening of almost 5-10 points in Green Trajectory. A bit of bounce was witnessed in the Index Constituents Stocks, may be due to Short Covering, which led NIFTY to kiss the intraday High of 5422.60. For whole of the session, markets traded in a very tight and small range. However, during late afternoon session selling pressure took over buying interest and dragged the market to intraday low, in red, and NIFTY made a low of 5367.45 for the day. For the day, NIFTY managed to close marginally above its crucial short-term support of 5380 at 5394.85.
Technically, NIFTY has completed the southward movement of Fibonnaci Retracement drawn from the High of 6338.50 (08th November, 2010) to the Low of 5177.70 (11th February, 2011). NIFTY has also completed another longer Extension Level drawn from the Low of 4786.45 (25th May, 2010) to the High of 6335.90 (08th November, 2010). Yesterday, NIFTY made a low of 5367.45 breaching the 61.80% level of 5378.79, this level is acting as a Short Term Strong Support Level for NIFTY on Closing Basis. Earlier, a Negative Crossover was witnessed between 200-Days SMA and 20-Days EMA. The Negative Crossover of 20-Days EMA (Exponential Moving Average) and the 50-Days SMA (Simple Moving Average) will now lead to more southward movement in NIFTY. This time selling pressure is more witnessed due to Uncertain Economic Conditions both Internationally and Domestically, Continuous Net Outflow from the FIIs and deep correction in the stocks prices in a minimal time. Now, the level of 5350 is acting as a Strong Support on the Closing Basis for NIFTY, whereas the level of 5500 is acting as a crucial Resistance on the Closing Basis.
On the Economic Front, JAPAN will be coming out with its Corporate Service Price for the month of April. Gfk Consumer Confidence Survey for the month of June will be announced in GERMANY. UK will be coming out with its Q1 Total Business Investment, Q1 Gross Domestic Product, Index of Services for the month of March and BBA Mortgage Approvals for the month of April. MBA Mortgage Applications, Durable Goods Orders for the month of April and Housing Price Index for the month of March will be announced in US.
Traders are suggested to trade cautiously by following Strict Stop Losses and Booking Fast Profits, whereas, Investors are suggested to make Fresh Investments at this point of time in the Markets in the stocks heavily beaten down with the Averaging Principle.
Q4 FY11 Results Season is running all over the Financial World. Hence, here is a quick look at some important results to be announced domestically and internationally. ABGSHIP, AECHIES, BANKINDIA, CAIRN, COALINDIA, GUJARAT ALKALI, GULFOILCORP, ILFSENGG, INDSWIFTLAB, JKLAKSHMI, MADRASCEM, RAMCOIND, TATASTEEL and TRENT will be announcing their Q4 FY11 Results tomorrow in INDIA. Areva Group PLC will be announcing its Results in UK.
NIFTY is trading below its 20-Days EMA, 200-Days SMA and 50-Days SMA of 5531.20, 5755.21 and 5638.00, respectively on the Closing Basis. MACD (Moving Average Convergence Divergence) and RSI (Relative Strength Index) are signaling a bit of more selling pressure to come in.
As stated earlier, that if this time NIFTY did not take the support of 5450 and reverted, it may test the previous lows of 5370 and 5180 too, Traders and Investors should keep this in mind while aggressively dealing with the Markets. Markets are also moving on Events and Sentiments at this time.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 36.62 and 38.10, respectively, showing a positive crossover.
2. MACD (26 Days & 12 Days): Their Values are -132.04 and -130.18, respectively. a positive crossover is indicated by both the Moving Averages.
3. +DI: 14.60, -DI: 27.47, ADX: 28.19: The Negative Directional Index has gained strength over the Positive Directional Index and also the Average Directional Index is above 20, indicating the development of strength in the current trend.
Some Trading Stats of the Tuesday’s (24th May, 2011) Trading Session:
Net Buying of Rs. 188.16 Crore in Cash and of Rs. 514.46 Crore in F&O Segment by FIIs was witnessed on Tuesday’s Trading Session.
Net Selling of Rs. 129.53 Crore and of Rs. 786.87 Crore was witnessed in Mutual Funds and Proprietory Trades, whereas, Net Buying of Rs. 1123.06 Crore was witnessed in Others Segment.
In F&O Segment Net buying Rs. 85.10 Crore, of Rs. 351.17 Crore and of Rs. 81.55 Crore was witnessed in Index Futures, Index Options and Stock Futures Segment, respectively, whereas, Net Selling of Rs. 3.37 Crore was witnessed in Stock Options Segment.
NIFTY MAY FUTURE ended in a Discount of 7 points to the Spot NIFTY.
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