Yesterday, NIFTY made a Short White Candlestick Pattern, with a longer upper shadow. NIFTY had a flat opening with a negative bias, but moved higher and made an intraday high of 5520.15. It kept trading flat in a very narrow range before the announcement of Monthly Inflation Data for the month of May. May Inflation were declared at 9.06% Vs 8.66% in the month of April. The numbers were much bad as compared to the Street’s expectations. After the announcement of data, NIFTY dipped for the day a bit and slipped to 5495 levels. But again NIFTY gained strength and reverted from that level to touch the day’s high, but due to the news flow of rising of reserve requirement in China by 25 Basis Points, NIFTY again dipped to the day’s low and made a new intraday low of 5484.20. It was again a very low volume day. In the last few hours of trading session NIFTY picked up from the day’s low again and started trading very flat in a very tight range. Only INFRA & REALTY and AUTO Sector Stocks took a knock, after the announcement of Inflation data. For the NIFTY closed at 5500.50.
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. Yesterday too, the 20-Days EMA played a role of a good resistance level and NIFTY crossed it by making an intraday high of 5520.15, but ended below it at 5400.50. Now the level of 5635 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. Markets are waiting for an important Trigger to make a big move on the either way; the Trigger may be at the National Level or at the International Level.
On the Economic Front, BoJ (Bank of Japan) will be coming out with its Monthly Economic Survey in JAPAN. UK will be coming out with its Claimant Count Rate, Claimant Count Change for the month of May and ILO Unemployment Rate, Average Earnings for the month of April. EUROPEAN MONETARY UNION will be coming out with Industrial Production for the month of April. MBA Mortgage Applications, Consumer Price Index, Capacity Utilization and Industrial Production for the month of May, Net Long-Term TIC Flows, Total Net TIC Flows for the month of April and NAHB Housing Market Index for the month of June 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.
NIFTY is again trading below its 20-Days EMA, 50-Days SMA and 200-Days SMA of 5513.78, 5623.92 and 5757.65, 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 47.31 and 47.44, respectively, showing a short term positive crossover.
2. MACD (26 Days & 12 Days): Their Values are 35.32 and -4.33, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 22.38, -DI: 23.91, ADX: 14.94: The Positive 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 5757.65, 5623.92 and 5513.78.
Some Trading Stats of the Tuesday’s (14th June, 2011) Trading Session:
Net Selling of Rs. 798.53 Crore in Cash and of Rs. 264.41 Crore in F&O Segment by FIIs was witnessed on Tuesday’s Trading Session.
Net Selling of Rs. 866.95 Crore was witnessed in Proprietory Trades, whereas, Net Buying of Rs. 336.23 Crore and of Rs. 371.61 Crore was witnessed in Mutual Funds and Others Segment, respectively.
In F&O Segment Net Selling of Rs. 362.30 Crore, of Rs. 167.23 Crore and of Rs. 68.34 Crore was witnessed in Index Options, Stock Futures and Stock Options, respectively, while, Net Buying of Rs. 333.46 Crore was witnessed in Index Futures.
NIFTY JUN FUTURE ended at a Premium of 15.30 Points to NIFTY Spot.
A view on some of the NIFTY 50 Stocks for TOMORROW:
AXISBANK: Can touch the levels of 1280/1290, if crosses the level of 1260.
BAJAJ-AUTO: Can touch the levels of 1400, if crosses the level of 1375.
ICICIBANK: Can touch the levels of 1075, if crosses the level of 1055.
HINDALCO: Can dip to the levels of 173/171, if breaches the level of 176.
IDFC: Can dip to the levels of 127/125, if breaches the level of 129.50.
RELIANCE: Can dip to the levels of 900/895, if breaches the level of 910.
TATAMOTORS: Can dip to the levels of 970/960.
For the day, intraday resistance for NIFTY comes at 5550 / 5580 / 5620 levels. At the same time, 5450 / 5420 / 5375 will act as major intraday support levels.
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