Yesterday, NIFTY made a Small Black Candlestick Pattern, representing much of a Black Opening Marubozu Candlestick Pattern. It is a day for bears and such a bearish rally should cause concern among the bulls. NIFTY had a Gap Up opening of almost 40-45 points, triggered by strong global cues. With the opening only, NIFTY made a high of 5679.65 for the day, however, within seconds the market was struck by selling pressure. Later with constant buying seen in REALTY & INFRA, BANKING & FINANCE and AUTO Stocks markets recovered marginally from the lower levels and traded range – bound till the closing session. SUGAR Sector stocks were the main performers of the day. Finally for the day, NIFTY ended at 5650.50.
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). After making a low of 5195.90 on 20th June, 2011, NIFTY again reverted and entered the Extension marked on the chart. The positive and unpredicted strong move in NIFTY is aided by Short Covering earlier and then by approval of Measures adopted by European Government for Greece and sudden huge inflow from Foreign Institutional Investors (FIIs). An excellent move of almost 450 points has been witnessed in just 10 days. A Negative Crossover between 200-Days SMA (Simple Moving Average) and 50-Days SMA is still intact, but at the same time both the 20-Days EMA (Exponential Moving Average) and 20-Days have given a positive crossover, which signals a positive move for some of the trading sessions ahead. Now, the 200-Days SMA of 5750 is playing a role of a good resistance level for NIFTY, whereas the level of 5170 proved to be a Good Support.
On the Economic Front, JAPAN will be coming out with its Labor Cash Earnings for the month of May. Purchasing Manager Index Services for the month of June will be announced in GERMANY. EUROPEAN MONETARY UNION will be announcing Purchasing Manager Index Services for the month of June and Retail Sales for the month of May. Purchasing Manager Index Services and BRC Shop Price Index for the month of June will be announced in UK. US will be announcing its Factory Orders for the month of May.
Traders are suggested to trade cautiously by following Strict Stop Losses and Booking Fast Profits, whereas, Investors are suggested to focus on Bottom Fishing and invest in the markets for short term only, as markets are still prone to Uncertain Scenario both at the International and National Levels.
NIFTY is again trading above its 20-Days EMA and 50-Days SMA of 5506.50 and 5514.82, respectively, but at the same time is still below its 200-Days SMA of 5748.02.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 63.36 and 55.94, respectively, showing a short term positive crossover.
2. MACD (26 Days & 12 Days): Their Values are 24.87 and 33.30, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 33.84, -DI: 19.44, ADX: 20.80: 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 5750.08, 5514.82 and 5506.50.
Some Trading Stats of the Monday’s (04th July, 2011) Trading Session:
Net Buying of Rs. 1131.72 Crore in Cash and of Rs. 1565.26 Crore in F&O Segment by FIIs was witnessed on Monday’s Trading Session.
Net Selling of Rs. 2.84 Crore and of Rs. 600.36 Crore was witnessed in Mutual Funds and Others Segment, whereas, Net Buying of Rs. 143.62 Crore was witnessed in Proprietory Trades.
In F&O Segment Net Selling of Rs. 160.39 Crore and of Rs. 28.37 Crore was witnessed in Stock Futures and Stock Options, respectively, whereas, Net Buying of Rs. 731.15 Crore and of Rs. 1022.88 Crore was witnessed in Index Futures and Index Options, respectively.
NIFTY JUN FUTURE ended at a Discount of 15.35 Points to NIFTY Spot.
A view on some of the NIFTY 50 Stocks for TOMORROW:
DLF: Can touch the levels of 240/242, if crosses the level of 235.
GAIL: Can touch the levels of 471/472, if crosses the level of 460-461.
GRASIM: Can touch the levels of 2190/2200, if crosses the level of 2150.
PNB: Can touch the levels of 1145/1155, if crosses the level of 1125-1130.
RCOM: Can touch the levels of 104/105, if crosses the level of 101.
RELCAPITAL: Can touch the levels of 615/620, if crosses the level of 600.
RELINFRA: Can touch the levels of 592/595, if crosses the level of 581.
ITC: Can dip to the levels of 194/192, if breaches the level of 198.
For the day, intraday resistance for NIFTY comes at 5680 / 5720 / 5750 levels. At the same time, 5620 / 5580 / 5550 will act as major intraday support levels.
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