On Friday, NIFTY made a Black Opening Marubozu Candlestick Pattern,
which engulfed the last two candles in it completely. This Candlestick
Pattern suggests that it was a day for bears and such a bearish rally should
cause concern among the bulls. Due to strong Positive Global Cues, NIFTY marked
a Gap Up opening of almost 55 points. But immediately after opening and marking
a high of 5194.45, NIFTY started losing its sheen and slipped to the levels of
5150 in the morning session only. Markets
were eagerly waiting for the IIP (Index of Industrial Production) to be
announced for the month of July. The country’s annual industrial output grew
8.8% in June as compared to a nine-month low of 5.6% in May. The street was
expecting it to be in the range of 5.6-5.8%. However, bears gripped trader mood
in early afternoon trade, thus, making fresh lows. Hence, NIFTY marked a low of
5053.35 for the day, but it didn’t breach the crucial support of 5050. Interest
Rate Sensitive Sectors like BANKING & FINANCE, REALTY & INFRA and METAL
slipped the most. It slipped almost 140 points from the opening level or say
from the day’s high. Nonetheless, bulls made a comeback for a brief period in
late afternoon, pulling the markets in positive terrain once again. NIFTY rose
to as high as 5100. As closing bell neared, equities trimmed gains again and
pulled the blinds in the red zone. For the day NIFTY managed to close at the
level of 5072.95.
Fear all over the Globe is the
main cause of such fierceful crash within a short span of time. Still more bad
news is in the offing regarding the International Economies. Indian Markets are
just paying the cost of Globalization, hence affected to that level much. Right
now, no signs are visible for a Pullback, but at the same time, traders and
investors should be ready for a sharp pullback, as this crash is coming with
huge Gaps and with volume backed by fears more.
Technically, NIFTY opened just below
the lower trendline marked from the low of 5177.70 (02nd February,
2011) to the low of 5195.90 (26th June, 2011) at 5194.40. NIFTY is
trading below this lower trendline on closing basis, since last five trading
sessions. On Friday too it marked the closing of 5072.95. The 20-Days EMA and
50-Days SMA have again made a Negative Crossover, hence, indicating more
selling pressure to creep in. A Negative Crossover between 200-Days SMA (Simple
Moving Average) and 50-Days SMA is still intact. Right now, the level of 5200
is playing a role of a stiff resistance level for NIFTY on the closing basis,
whereas the level of 5000 will be acting as a Good Support Level in the coming sessions.
The so-called level of 4800 will soon be achieved by NIFTY in the coming
period, as there is more Bad News in the offing in terms of International
Economic Uncertainties. A Fibonnaci Retracement Level is being drawn from the
High of 6338.50 (08th November, 2010) to the recent 14-Months Low
marked 4946.45 by NIFTY (09th August, 2011), which represents the
level of 5274.36 (Level of 61.80%) as the first important resistance level to
be crossed on the Closing Basis for the NIFTY to enter in a Comfortable Zone
for traders.
On the Economic Front, GERMANY will be coming out with its Q2
Gross Domestic Product. DCLG House Price Index, Retail Price Index, Core
Consumer Price Index and Consumer Price Index for the month of July will be
announced in UK. EUROPEAN MONETARY UNION
will be announcing its Q2 Gross Domestic Product and Trade Balance for the
month of July. Import Price Index, Housing Starts, Building Permits, Capacity
Utilization and Industrial Production for the month of July 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 from the markets right now, as market will give
better chances ahead for Bottom Fishing and earning handsome returns
thereafter.
NIFTY is trading below all its
Moving Averages like 200-Days SMA, 50-Days SMA and 20-Days EMA of 5661.98, 5475.04
and 5339.27, respectively. 14-Days RSI (Relative Strength Index) and 26-Days
MACD (Moving Average Convergence and Divergence) have also reached to their
oversold zone and are indicating a pull back in the short term.
What does Indicators Say?
2. MACD (26 Days & 12 Days): Their Values are -164.00 and -98.91, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 11.34, -DI: 38.82, ADX: 28.24: The
Negative Directional Index has gained strength over the Positive
Directional Index and also the Average Directional Index is above 20,
indicates that the market is in the trending range right now.
4. SMA (200 Days), SMA (50 Days) & EMA (20 Days): NIFTY is trading below the levels of of these indicators are 5661.98, 5475.04 and 5339.27.
Some Trading Stats of the Friday’s (12th August, 2011)
Trading Session:
Net Selling of Rs. 471.09 Crore in Cash and of Rs. 324.99 Crore in F&O Segment by FIIs was witnessed on Friday’s Trading Session.
Net Buying of Rs. 92.52 Crore and of Rs. 385.78 Crore was witnessed in Mutual Funds and Others
Segment, respectively, whereas, Net Selling of Rs. 406.25 Crore was witnessed in Proprietory Trades.
In F&O Segment Net Buying of Rs. 200.42 Crore, of Rs. 116.36 Crore and of Rs. 6.72 Crore was witnessed in Index Options,
Stock Futures and Stock Options, respectively,
whereas, Net Selling of Rs. 648.48 Crore was witnessed in Index Futures.
NIFTY AUG FUTURE ended at a Premium of 6.90
Points to the Spot NIFTY.
A view on some of the NIFTY 50 Stocks for TOMORROW:
AMBUJACEM: Can touch the levels of 134/135, if crosses the level of 132.
HINDALCO: Can dip to the levels of 146/145, if breaches the level of 150.
PNB: Can dip to the levels of 1065/1055, if breaches the level
of 1080.
RCOM: Can dip to the levels of 82/81, if breaches the level of 84.
For the day, intraday resistance for NIFTY comes at 5090 / 5120 / 5160 levels. At the same time, 5050 / 5020 / 4980 will act as major intraday support levels.
For the week, resistance for NIFTY comes at 5230 & 5350 levels. At the same time, 4950 & 4800 will act as major support levels.
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