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 very flat opening with 4-5 points in the positive territory, but immediately after the opening NIFTY slipped in Red. NIFTY made a high of the same point where it opened for the day. For the day, NIFTY made a low of 5612.30, it reverted back from the day’s low and again returned to the opening level of the day. OIL & GAS, FMCG, REALTY & INFRA and BANKING & FINANCE witnessed a bit of selling pressure which dragged the market down. In the last hour of trading NIFTY bounced very well from the day’s low, but in the last thirty hours it again slipped in red and closed the session at 5632.10. It’s consecutive third session, where NIFTY tried to touch 5700, but is closing lower and lower day-by-day.
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 Leading Economic Index, Coincident Index, and Core Machinery Orders for the month of May. Q1 Gross Domestic Product will be announced by EUROPEAN MONETARY UNION. GERMANY will be coming out with its Factory Orders for the month of May. MBA Mortgage Applications and ISM Non-Manufacturing 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 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 5518.46 and 5510.10, respectively, but at the same time is still below its 200-Days SMA of 5746.76.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 61.31 and 57.01, respectively, showing a short term positive crossover.
2. MACD (26 Days & 12 Days): Their Values are 8.85 and 28.41, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 32.31, -DI: 20.54, ADX: 20.91: 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 5746.76, 5510.10 and 5518.46.
Some Trading Stats of the Tuesday’s (05th July, 2011) Trading Session:
Net Buying of Rs. 825.52 Crore in Cash while Net Selling of Rs. 573.84 Crore in F&O Segment by FIIs was witnessed on Tuesday’s Trading Session.
Net Selling of Rs. 1025.88 Crore and of Rs. 552.63 Crore was witnessed in Proprietory Trades and Others Segment, whereas, Net Buying of Rs. 13.25 Crore was witnessed in Mutual Funds.
In F&O Segment Net Selling of Rs. 158.10 Crore, of Rs. 634.97 Crore and of Rs. 22.75 Crore was witnessed in Index Futures, Stock Futures and Stock Options, respectively, whereas, Net Buying of Rs. 241.98 Crore was witnessed in Index Options.
NIFTY JUN FUTURE ended at a Premium of 19 Points to NIFTY Spot.
A view on some of the NIFTY 50 Stocks for TOMORROW:
GRASIM: Can touch the levels of 2250/2260, if crosses the level of 2220.
HCLTECH: Can touch the levels of 515/518, if crosses the level of 508.
M&M: Can touch the levels of 728/732, if crosses the level of 720.
RELCAPITAL: Can touch the levels of 622/625.
RPOWER: Can touch the levels of 121/122, if crosses the level of 119.
SAIL: Can touch the levels of 145/146.
BHEL: Can dip to the levels of 1920/1910, if breaches the level of 1945.
HINDUNILVR: Can dip to the levels of 327/324, if breaches the level of 332.
RELIANCE: Can dip to the levels of 835/830, if breaches the level of 845.
For the day, intraday resistance for NIFTY comes at 5660 / 5680 / 5720 levels. At the same time, 5600 / 5580 / 5550 will act as major intraday support levels.
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