On Friday, NIFTY made a Bearish Belt Hold Pattern. It was a day
for bears and such a bearish rally should cause concern among the bulls. Markets relinquished their
three-day profit making spree to end with losses. NIFTY opened flat but with a positive
note. However, weak sentiment prevailing globally took its toll on the domestic
equities soon, as they fell into the negative terrain in a jiffy. In the early
hours of trade NIFTY dived almost 50 points from the day’s high and dipped
below 5100 levels. But NIFTY again took a reverse gear and bounced back sharply
from 5100 levels and again reached to the day’s high till the opening of the
European Markets. Nevertheless, weak European markets took their toll on the market
as NIFTY fell below its key psychological level of 5,100. As soon as NIFTY
breached the level of 5100 for the day, it completely melted below it and
reached to the day’s low of 5046.80 without any force. Weak sentiment weighed
on the broader market as well. Markets melted due to Global Economic Slowdown,
High Interest Rate Concerns, Profit Booking and Weak US Economic Data. METAL,
BANKING & FINANCE, REALTY & INFRA, OIL & GAS and IT were the
biggest losers for the day. For the day, NIFTY closed near to its day’s low at 5059.45.
Technically, NIFTY took a Strong
support of 4720 once again and bounced back from that only. As mentioned
earlier too that the so-called level of
4800 got achieved by NIFTY; still it is in the down trend, as there is more Bad
News in the offing in terms of International Economic Uncertainties, hence
traders and investors should be ready for the more down side ahead. The 20-Days
EMA and 50-Days SMA are in 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 4720 will be acting as a Good Support Level in the coming sessions.
A Fibonnaci Retracement Level is being drawn from the High of 6338.50 (08th
November, 2010) to the recent 18-Months Low marked 4720.00 by NIFTY (26th
August, 2011), which represents the level of 5100 (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. NIFTY entered it too since
last three trading sessions, but on Friday it could not sustain to mark it as a
closing above it. Hence, still the traders and investors should wait for
fruitful results ahead. However, Traders are suggested to take the advantage of
Swing Trading, which will appear many times in between.
On the Economic Front, UK will be coming out with its Nationwide
Consumer Confidence and RICS Housing Price Balance for the month of August. INDIA will be announcing its Index of
Industrial Production (IIP) Number for the month of July.
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 5564.30, 5316.93
and 5065.85, respectively. 14-Days RSI (Relative Strength Index) and 26-Days
MACD (Moving Average Convergence and Divergence) have reverted from the
oversold zone, but still with every sell off in the markets they are heading
towards their oversold zone.
What does Indicators Say?
2. MACD (26 Days & 12 Days): Their Values are -76.03 and -159.45, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 23.12, -DI: 27.01, ADX: 31.26: The Negative Directional Index has gained strength over the Positive Directional Index and also the Average Directional Index is above 40, indicates that the market is in the trading range right now.
4. SMA (200 Days), SMA (50 Days) & EMA (20 Days): NIFTY is trading below the levels of of these indicators are 5564.30, 5316.93 and 5065.85.
Some Trading Stats of the Friday’s (09th September,
2011) Trading Session:
Net Selling of Rs. 427.67 Crore in Cash while, Net Buying of Rs. 142.36 Crore in F&O Segment by FIIs was witnessed on Friday’s Trading Session.
Net Selling of Rs. 615.53 Crore and of Rs. 148.71 Crore was witnessed in Proprietory
and Others Trades, whereas, Net Buying of Rs. 15.56 Crore was witnessed in Mutual Funds Segment.
In F&O Segment Net Buying of Rs. 690.43 Crore, of Rs. 146.42 Crore and of Rs. 21.40 Crore was witnessed in Index Options,
Stock Futures and Stock Options, respectively,
whereas, Net Selling of Rs. 715.89 Crore was witnessed in Index Futures.
NIFTY SEP FUTURE ended at a Discount of 6.95
Points to the Spot NIFTY.
A view on some of the NIFTY 50 Stocks for TOMORROW:
HINDUNILVR: Can touch the levels of 338/340, if crosses the level of 334.
AXISBANK: Can dip to the levels of 1085/1075, if breaches the level of 1100.
GAIL: Can dip to the levels of 409/407, if breaches the level of
415.
HINDALCO: Can dip to the levels of 147/146, if breaches the level of 150.
IDFC: Can dip to the levels of 111/110, if breaches the level of
114.
INFY: Can dip to the levels of 2230/2220, if breaches the level
of 2275.
ITC: Can dip to the levels of 195/194, if breaches the level of
198.
RCOM: Can dip to the levels of 81.20/80.20, if breaches the
level of 83.60.
RELCAPITAL: Can dip to the levels of 397/395, if breaches the level of 408.
SBIN: Can dip to the levels of 1930/1910, if breaches the level
of 1950.
TATASTEEL: Can dip to the levels of 468/465, if breaches the level of 475.
For the week, resistance for NIFTY comes at 5200 & 5320 levels. At the same time, 4880 & 4750 will act as major support levels.
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