Yesterday, NIFTY made a Doji Candlestick Pattern, showing indecision about the direction of the market and it represents a tug of war between buyers and sellers. The overall result was a standoff. It shows that neither the bulls nor the bears were able to gain control during the day and it is possible that a turning point can develop soon. NIFTY had a very flat opening of almost 2-3 points in the Red territory. Markets traded very range bound with a negative bias till the announcement of Weekly Inflation Data and after the announcement made a low of 5502.05, but did not breach the crucial support of 5500. Immediately after touching the day’s low NIFTY reverted and made a high of 5540.10 for the day. Again it was an extremely volatile market, trading in a very tight range. For the day, NIFTY closed at 5521.05. NIFTY could not touch or cross its important resistance of 5580, but did not even breached the support of 5500 for whole of the session, which clearly indicates that the markets are still undecided about their further move and are waiting for a trigger to decide it.
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). 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. On Friday, again 20-Days EMA played the role of a good support level and NIFTY closed just above the level, however breached it in intraday trading. Hence, now the level of 5650 is acting as a Short Term Resistance, for NIFTY, where the 50-Days SMA lies too, whereas the level of 5320 proved to be a Good Support. A technical bounce till the level of 5650 is expected in NIFTY, which will be supported by BANKING & FINANCE and REALTY & INFRA Sector Stocks.
On the Economic Front, CHINA will be coming out with its Trade Balance for the month of May. Wholesale Price Index and Consumer Price Index for the month of May will be announced in GERMANY. UK will be coming out with its Producer Price Index – Input & Output for the month of May, Manufacturing Production and Industrial Production for the month of April. Import Price Index, Export Price Index NIESR GDP Estimate and Monthly Budget Statement for the month of May will be announced in US. INDIA will be coming out with its IIP (Index of Industrial Production) for the month of APRIL.
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.
NIFTY moved much above its 20-Days EMA of 5522.04, but it is still trading below its 200-Days SMA and 50-Days SMA of 5757.53 and 5641.70, respectively. MACD (Moving Average Convergence Divergence) and RSI (Relative Strength Index) are signaling a short term northward move in the markets, due to the positive crossovers.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 48.76 and 48.60, respectively, showing a short term positive crossover.
2. MACD (26 Days & 12 Days): Their Values are 12.42 and -37.74, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 23.58, -DI: 21.19, ADX: 17.25: The Positivee Directional Index has gained strength over the Negative Directional Index and also the Average Directional Index is above 20, indicating that the market is in the trading range right now.
4. SMA (200 Days), SMA (50 Days) & EMA (20 Days): The values of these indicators are 5757.53, 5641.70 and 5522.04.
Some Trading Stats of the Thursday’s (09th June, 2011) Trading Session:
Net Selling of Rs. 24.73 Crore in Cash, and of Rs. 54.07 Crore in F&O Segment by FIIs was witnessed on Thursday’s Trading Session.
Net Selling of Rs. 435.74 Crore was witnessed in Proprietory Trades, whereas, Net Buying of Rs. 35.27 Crore and of Rs. 283.93 Crore was witnessed in Mutual Funds and Others Segment, respectively.
In F&O Segment Net Selling of Rs. 391.26 Crore and of Rs. 145.50 Crore was witnessed in Index Futures and Stock Futures, respectively, whereas, Net Buying of Rs. 461.36 Crore and of Rs. 21.34 Crore was witnessed in Index Options and Stock Options, respectively.
NIFTY JUN FUTURE ended at a Discount of 1.90 Points to NIFTY Spot.
A view on some of the NIFTY 50 Stocks for TOMORROW:
BHEL: Can touch the levels of 1960/1970, if crosses the level of 1935.
HDFC: Can dip to the levels of 638/635, if breaches the level of 650.
HEROHONDA: Can dip to the levels of 1720/1700, if breaches the level of 1740.
For the day, intraday resistance for NIFTY comes at 5550 / 5580 / 5620 levels. At the same time, 5500 / 5475 / 5450 will act as major intraday support levels.
No comments:
Post a Comment