Yesterday, NIFTY made a Small Black Candlestick Pattern, with a higher upper shadow. NIFTY had a Gap Down Opening of almost 40-45 points in the downside, following jitters across the globe over civil crisis in Greece. After a Gap Down, NIFTY recovered a bit from the day’s low and traded flat at the levels of 5400, trying to maintain itself above an Important Support Level. It was again a D-Day for the Dalal Street, as Reserve Bank of India (RBI) was going to announce its Credit Policy. The bank hiked the key rates for the tenth time since March 2010 to tackle the spiraling inflation. The key rates were hiked by 25 basis points. The repo rate was raised to 7.5% and the reverse repo rate now stands at 6.5%, while the cash reserve ratio remains unchanged. The Reserve Bank of India said the policy stance remains anti-inflationary and the inflation persists at uncomfortable levels. After the announcement of Policy, NIFTY witnessed a bit of short covering which spiked it up to the levels of 5435 for the day, but it immediately slipped again to the levels of 5400, due to weak opening of European Markets. Again, NIFTY rested for some time at the same levels and then spiked up the day’s high of 5447.50, supported by the covering seen in Interest Rate Sensitive Stocks, BANKING & FINANCE, REALTY & INFRA, METAL and AUTO. In the last hour of trading, immediately after touching the day’s high, NIFTY slipped to the levels of 5420 and then in the last fifteen minutes of trade it also breached the levels of 5400, marking a day’s low of 5389.80. Selling pressure entered in the markets with good volumes, heavy weights slid the most for the day. Finally for the day, NIFTY ended below its crucial support of 5400 at 5396.75.
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). As predicted the day before, yesterday, NIFTY in the intraday trading almost touched the 61.80% level of 5378, by making a low of 5389.80, but on the closing basis it managed to close at 5396.75, below the 50% level. 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. Now, the 20-Days EMA is playing a role of a good resistance level for NIFTY, 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, EUROPEAN MONETARY UNION will be coming out with ECB (European Commercial Bank) Monthly Report, Trade Balance and Construction Output for the month of April. Reuters/Michigan Consumer Sentiment Index for the month of June and leading Indicators for the month of May 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 stay away from the markets and avoid heavy investments at this time due to Uncertain Market Scenario both at the International and National Levels.
NIFTY is again trading below its 20-Days EMA, 50-Days SMA and 200-Days SMA of 5496.93, 5606.12 and 5757.75, respectively.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 38.28 and 44.80, respectively, showing a short term positive crossover.
2. MACD (26 Days & 12 Days): Their Values are 29.65 and 9.05, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 19.65, -DI: 30.68, ADX: 15.30: 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 5757.75, 5606.12 and 5496.93.
Some Trading Stats of the Thursday’s (16th June, 2011) Trading Session:
Net Selling of Rs. 599.52 Crore in Cash while Net Buying of Rs. 221.58 Crore in F&O Segment by FIIs was witnessed on Thursday’s Trading Session.
Net Selling of Rs. 275.29 Crore was witnessed in Proprietory Trades, whereas, Net Buying of Rs. 101.71 Crore and of Rs. 1714.00 Crore was witnessed in Mutual Funds and Others Segment, respectively.
In F&O Segment Net Selling of Rs. 732.24 Crore, of Rs. 340.29 Crore and of Rs. 15.69 Crore was witnessed in Index Futures, Stock Futures and Stock Options, respectively, whereas, Net Buying of Rs. 1309.79 Crore was witnessed in Index Options.
NIFTY JUN FUTURE ended at a Premium of 5.65 Points to NIFTY Spot.
A view on some of the NIFTY 50 Stocks for TOMORROW:
AMBUJACEM: Can dip to the levels of 122/121, if breaches the level of 125.
BHARTIARTL: Can dip to the levels of 362/360, if breaches the level of 370-369.
IDFC: Can dip to the levels of 117/115, if breaches the level of 120.
STER: Can dip to the levels of 186, if breaches the level of 188.
BPCL: Can touch the levels of 638/640, if crosses the level of 630.
RELINFRA: Can touch the levels of 590/595, if crosses the level of 577-578.
CENTURYTEX: Buy only if it trades above 360 with the SL of 355 for the TGTs 368/370.
SUNTV: Buy at the levels of 360 with the SL of 355 for the TGTs of 370/375.
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