Yesterday, NIFTY made a Long Black Candlestick Pattern, which registered
a closing below the last seven trading sessions. Due to Positive Global Cues,
NIFTY marked a Gap Up opening of almost 50 points. Within the seconds of
opening bell, NIFTY marked the intraday high of 5132.20. But immediately after
opening and marking a high it started losing its sheen and slipped to the
levels of 5090 in the morning session only. Markets traded in the range of
10-15 points for some time, unable in deciding the direction before the opening
of European Markets. Later, with the European markets opening on weak note,
equities back home started posting losses and slipped in red to hit the day’s
low of 5015.40, hence falling almost 100 points from the day’s high. The Mid
Cap and Small Cap Stocks witnessed brutal selling pressure, registering a
downside of almost 10-20%, led primarily by REALTY & INFRA Sector. Although,
the sell off was witnessed all across the board in the Mid Cap Counter. REALTY
& INFRA and METAL Sectors took a sharp deep cut in yesterday’s session, while,
IT Sector remained in a bit of Green Territory. At the last half an hour of
trading, a pullback was witnessed, which helped the NIFTY in registering a
Close of 5035.80.
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 below the
lower trendline marked from the low of 5177.70 (02nd February, 2011)
to the low of 5195.90 (26th June, 2011) at 5125.75. NIFTY is trading
below this lower trendline on closing basis, since last seven trading sessions.
Yesterday it marked the closing of 5035.80, breaching the crucial support of
5050 too on the closing basis. 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, JAPAN will be coming out with its Merchandise
Trade Balance for the month of July. Current Account for the month of June and
Consumer Price Index for the month of July will be announced by EUROPEAN MONETARY UNION. UK will be
coming out with Average Earnings including Bonus, Average Earnings excluding
Bonus, ILO Unemployment Rate for the month of June, Claimant Count Rate and
Claimant Count Change for the month of July. MBA Mortgage Applications and
Producer Price Index 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 5657.22, 5465.11
and 5310.37, respectively. 14-Days RSI (Relative Strength Index) and 26-Days
MACD (Moving Average Convergence and Divergence) are moving towards their oversold
zone with every sell off in the markets.
What does Indicators Say?
2. MACD (26 Days & 12 Days): Their Values are -177.63 and -114.65, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 10.45, -DI: 38.33, ADX: 30.30: 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 5657.22, 5465.11 and 5310.37.
Some Trading Stats of the Tuesday’s (16th August, 2011)
Trading Session:
Net Selling of Rs. 261.12 Crore in Cash and of Rs. 307.67 Crore in F&O Segment by FIIs was witnessed on Tuesday’s Trading Session.
Net Selling of Rs. 45.55 Crore and of Rs. 1552.89 Crore was witnessed in Mutual
Funds and Proprietory Trades,
respectively, whereas, Net Buying of Rs. 1923.42 Crore was witnessed in Others
Segment.
In F&O Segment Net Buying of Rs. 799.31 Crore, of Rs. 514.16 Crore and of Rs. 22.51 Crore was witnessed in Index Futures,
Stock Futures and Stock Options, respectively,
whereas, Net Selling of Rs. 1643.66 Crore was witnessed in Index Options.
NIFTY AUG FUTURE ended at a Discount of 8.10
Points to the Spot NIFTY.
A view on some of the NIFTY 50 Stocks for TOMORROW:
HDFC: Can dip to the levels of 633/630, if breaches the level of
643.
HDFCBANK: Can dip to the levels of 450/445, if breaches the level of 456.
HINDALCO: Can dip to the levels of 140/139, if breaches the level of 144.
IDFC: Can dip to the levels of 111/110, if breaches the level of
114.
JPASSOCIAT: Can dip to the levels of 55/54, if breaches the level of 57.
RELCAPITAL: Can dip to the levels of 400/398, if breaches the level of 410.
For the day, intraday resistance for NIFTY comes at 5050 / 5090 / 5120 levels. At the same time, 5010 / 4980 / 4950 will act as major intraday support levels.
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