Yesterday was one more panic day in our market. Nifty opened week and traded uni-directionally downwards breached all the support levels comfortably. Important support of 3800 also been breached to make a new low of 3777. There was blood bath across all the sectors which may be attributed to redemption from large institutions for the quarter ending September. Yesterday’s action has made the weekly chart more damaged in addition to the weakness imparted to it by last week Friday’s market move. From the day’s low nifty bounced almost 100 points which may be due to short covering and profit booking.
US market crashed in a jaw dropping manner as the financial rescue bailout package plan failed in the Congress voting. Asian markets also opened and trading very weak. Inline with global market nifty is expected to open in a gap down manner. Even a gap down of 100-150 points or more cannot be ruled out.
On the lower side nifty may find support at 3752 or 3659 levels. Similarly on the upper side resistance exists at 3901, 3978 or 4040 levels. It is to be noted that we have entered oversold region after whatever happened yesterday. So technical bounce back is due and is expected anytime if not today may be in couple of trading sessions. On the lower side don’t be surprised if the nifty moves to 3636 levels to test the 200 week moving average.
SUN OUTAGE: Between 24th Sep.’08 to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
Happy Trading !
Tuesday, September 30, 2008
Monday, September 29, 2008
29 Sep'08: Expect Rubber Band Effect
As we have mentioned in the last update, on Friday nifty took the Asian market cue and opened weak and closed at the weakest point. During the day nifty breached all the important support levels and closed at the lowest point of the day. More importantly it has closed below 4000 mark which is considered to be an important psychological support level.
US market closed mixed and Asian markets also trading mixed. With $700B bail out package through, US-India nuclear deal almost through and India-France nuclear deal to be signed on Tuesday, our market may rejoice and bounce from its last week low for a day or two.
By closing below 4000, nifty has made its weekly chart to be weak which was showing some signs of bottomed out last week. As nifty closed closer to the important Fibonacci support level, mild to strong bounce back may be expected from the current level. On the upper side nifty may find resistance at 4048, 4074 or 4097 levels. Similarly on the lower side support exists at 3934, 3919 or 3800 levels. Any strong up move may find strong resistance in the range of 4201 to 4239.
SUN OUTAGE: Between 24th Sep.’08 to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
Happy Trading !
US market closed mixed and Asian markets also trading mixed. With $700B bail out package through, US-India nuclear deal almost through and India-France nuclear deal to be signed on Tuesday, our market may rejoice and bounce from its last week low for a day or two.
By closing below 4000, nifty has made its weekly chart to be weak which was showing some signs of bottomed out last week. As nifty closed closer to the important Fibonacci support level, mild to strong bounce back may be expected from the current level. On the upper side nifty may find resistance at 4048, 4074 or 4097 levels. Similarly on the lower side support exists at 3934, 3919 or 3800 levels. Any strong up move may find strong resistance in the range of 4201 to 4239.
SUN OUTAGE: Between 24th Sep.’08 to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
Happy Trading !
Friday, September 26, 2008
26 Sep'08: Technical Analysis Works
The action of the market speaks for itself about whatever predictions we made yesterday. As we expected, market opened weak and fell unidirectionally towards and closer to the mentioned support of 4069 where it took support and has made its day low at 4077. One interesting point to be noted was that, during the bounce back from the day’s low nifty tried several times to break past the level of 4129 but finally failed only to fall back towards the psychological support level of 4100. Technically and interestingly in the intraday chart, 4129 happens to be a strong Fibonacci resistance level.
Yesterday also “IT” stocks continued to get hammered and IT(s) index was down by 2.8%. Towards the closing of the market, nifty showed some strength by bouncing sharply from the day’s support level which may be part of expiry day drama or a genuine strength which will be validated in a couple of day’s session.
US market closed strong and Asian markets opened and trading weak. We have see to which global cue nifty will be responding for the day. My feeling is that Asian market cue may have more impact on our market than that of US’s as its moves are deceptive sometimes. Everyone is keen and interested to see how the October series will be in this bearish environment.
By closing above 4100 nifty has opened some hope among traders for a bounce back. On the upper side, nifty may find resistance near 4163, 4190 or 4215 levels. Similarly on the lower side nifty may find support around 4067 or 4051 levels. In the daily chart nifty shows some weakness whereas in weekly chart it shows signs of bottoming out. We have to wait for some more sessions to see in which direction market is going to pan out.
SUN OUTAGE: Between 24th Sep.’08 to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
Happy Trading !
Yesterday also “IT” stocks continued to get hammered and IT(s) index was down by 2.8%. Towards the closing of the market, nifty showed some strength by bouncing sharply from the day’s support level which may be part of expiry day drama or a genuine strength which will be validated in a couple of day’s session.
US market closed strong and Asian markets opened and trading weak. We have see to which global cue nifty will be responding for the day. My feeling is that Asian market cue may have more impact on our market than that of US’s as its moves are deceptive sometimes. Everyone is keen and interested to see how the October series will be in this bearish environment.
By closing above 4100 nifty has opened some hope among traders for a bounce back. On the upper side, nifty may find resistance near 4163, 4190 or 4215 levels. Similarly on the lower side nifty may find support around 4067 or 4051 levels. In the daily chart nifty shows some weakness whereas in weekly chart it shows signs of bottoming out. We have to wait for some more sessions to see in which direction market is going to pan out.
SUN OUTAGE: Between 24th Sep.’08 to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
Happy Trading !
Thursday, September 25, 2008
25 Sep'08: Expiry Week Drama
This week being the expiry week, lot of drama is happening in the market. In spite of weak US and Asian market cues, nifty managed to opened in the positive terrain and remained there for the rest of the day. Overall the intraday trend remained choppy. Nifty tested the mentioned resistance of 4195 and reached day’s high of 4207. Nifty short-lived above 4195 level for a very brief duration and fell below the resistance level and honored the same.
Yesterday also “IT” stocks got hammered and IT(s) index was down by 1.44%. Among the 50 nifty index stocks, Wipro recorded the top rank in the loser’s list by falling 4.82%. Starting from yesterday (24th Sep.’08) to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
US market traded choppy and closed mildly weak amid debate over government’s plan to bail out sick banks. Asian markets opened and trading weak. Nifty is expected to open weak and remain choppy as today is the last day of September ’08 series contracts.
On the upper side, nifty may find resistance near 4184, 4207 or 4236 levels and in any case nifty is not expected to breach 4274 for today. Similarly on the lower side nifty may find support around 4115 level, breaching and trading below 4115 may take nifty towards 4069 or 4051 levels. To resume a short term upward trend nifty has to close above 4225.
Nifty chart suggest that it has ripe for a fall in near future as some of the nifty dominant scripts seems to be very week in their charts. Also in any time it is expected that nifty may test the 4041-4051 levels to fill the gap of last Friday gap up.
Happy Trading !
Yesterday also “IT” stocks got hammered and IT(s) index was down by 1.44%. Among the 50 nifty index stocks, Wipro recorded the top rank in the loser’s list by falling 4.82%. Starting from yesterday (24th Sep.’08) to 8th Oct’08 market will remain closed between 11 25 hrs to 12 10 hrs due to sun outage and market will close at 16 15 hrs instead of 15 30 hrs.
US market traded choppy and closed mildly weak amid debate over government’s plan to bail out sick banks. Asian markets opened and trading weak. Nifty is expected to open weak and remain choppy as today is the last day of September ’08 series contracts.
On the upper side, nifty may find resistance near 4184, 4207 or 4236 levels and in any case nifty is not expected to breach 4274 for today. Similarly on the lower side nifty may find support around 4115 level, breaching and trading below 4115 may take nifty towards 4069 or 4051 levels. To resume a short term upward trend nifty has to close above 4225.
Nifty chart suggest that it has ripe for a fall in near future as some of the nifty dominant scripts seems to be very week in their charts. Also in any time it is expected that nifty may test the 4041-4051 levels to fill the gap of last Friday gap up.
Happy Trading !
Wednesday, September 24, 2008
24 Sep'08: More “N” More Damage
In lines with the expectation nifty had a gap down opening below 4200 and found support near the mentioned level of 4141. In spite of a very weak US cues and weak Asian markets nifty did not had a very big gap down opening. Gap down opening was followed by a recovery which may be due to short covering or manipulation by operators which was not expected with weak US and Asian cues.
Nifty rallied to recover and fill the opening gap down up to yesterday’s closing only to fall back to breach the support level of 4141 which eventually took nifty even down to close at the lowest point of the day. Nifty is becoming weaker and weaker day by day and more damage been done in the charts in continuation with yesterdays fall. Intraday nifty trend was mostly dominated by the price movement of Nifty heavyweight champion “Reliance Industries”. Also IT and Bank stocks were hammered out of shape with their index down by 4-5%.
Inline with weak US and Asian market cues, nifty may also open with a weaker note. Nifty may find support near 4110 or 4088 levels. Trading below 4088 for a while may take nifty to test 4051. On the upper side nifty may find resistance near 4150 or 4195 levels.
My gut feeling is that either nifty may breach 3800 in case of increased downward momentum without taking any breath or it may take a pause near 4051-3992 levels. One interesting point has to be noted is that in this ongoing bear run, most of the global indices either tested or breached their 200 week moving average except our market. So it is logical to expect our index also to test or breach its 200 week moving average which is at 3639.
Happy Trading !
Nifty rallied to recover and fill the opening gap down up to yesterday’s closing only to fall back to breach the support level of 4141 which eventually took nifty even down to close at the lowest point of the day. Nifty is becoming weaker and weaker day by day and more damage been done in the charts in continuation with yesterdays fall. Intraday nifty trend was mostly dominated by the price movement of Nifty heavyweight champion “Reliance Industries”. Also IT and Bank stocks were hammered out of shape with their index down by 4-5%.
Inline with weak US and Asian market cues, nifty may also open with a weaker note. Nifty may find support near 4110 or 4088 levels. Trading below 4088 for a while may take nifty to test 4051. On the upper side nifty may find resistance near 4150 or 4195 levels.
My gut feeling is that either nifty may breach 3800 in case of increased downward momentum without taking any breath or it may take a pause near 4051-3992 levels. One interesting point has to be noted is that in this ongoing bear run, most of the global indices either tested or breached their 200 week moving average except our market. So it is logical to expect our index also to test or breach its 200 week moving average which is at 3639.
Happy Trading !
Tuesday, September 23, 2008
23 Sep'08: “U” Turn
As expected yesterday nifty opened mildly gap up to test the 20 day and 50 day moving average crossover resistance of 4280-4300. During the day the trend was very choppy which is typical for expiry week. Nifty tried to break the Fibonacci retracement level of 4268 (which was mentioned in yesterdays notes) three times but could not succeed.
The way market closed at the low of the day suggests exhaustion of upward momentum and weakness in the upward trend. Also it has to be noted that whatever rally we say last week from the low of 3800 was held with the help of nifty heavyweights like Reliance Industries which also shows weakness in the charts.
Yesterday US market had a one way slide and closed at its day low with most of indices are down between 3 – 4%. Asian markets are trading mixed. On the backdrop of whatever happened in nifty and US market yesterday, expect a gap down below 4200. Nifty may take support near any of the levels of 4141, 4110 or 4051.
Happy Trading !
The way market closed at the low of the day suggests exhaustion of upward momentum and weakness in the upward trend. Also it has to be noted that whatever rally we say last week from the low of 3800 was held with the help of nifty heavyweights like Reliance Industries which also shows weakness in the charts.
Yesterday US market had a one way slide and closed at its day low with most of indices are down between 3 – 4%. Asian markets are trading mixed. On the backdrop of whatever happened in nifty and US market yesterday, expect a gap down below 4200. Nifty may take support near any of the levels of 4141, 4110 or 4051.
Happy Trading !
Monday, September 22, 2008
22 Sep'08:Bit Momentum Left
From the way market recovered from its week low of 3800 and the way it had closed on Friday without showing much weakness suggests that some more momentum is left on the upside. The upside momentum should be over in 2 or 3 days.
As the US market closed with high gain on Friday and most of the Asian market are in green nifty may open mildly gap up. Nifty will try to breach the Fibonacci retracement level of 4268 which it failed to cross on Friday. Once this level is crossed market will encounter resistance around the 20 day and 50 day moving average crossover which is around 4280-4300. If this is also breached then the next logical resistance would be 4379 & 4400 where profit booking is expected to take nifty down.
It is also to be noted that if nifty closed in green today then we would be completing 3 days of positive sessions in a row. Also since this week is an expiry week this factor is also to be included in the equation of volatility.
Happy Trading !
As the US market closed with high gain on Friday and most of the Asian market are in green nifty may open mildly gap up. Nifty will try to breach the Fibonacci retracement level of 4268 which it failed to cross on Friday. Once this level is crossed market will encounter resistance around the 20 day and 50 day moving average crossover which is around 4280-4300. If this is also breached then the next logical resistance would be 4379 & 4400 where profit booking is expected to take nifty down.
It is also to be noted that if nifty closed in green today then we would be completing 3 days of positive sessions in a row. Also since this week is an expiry week this factor is also to be included in the equation of volatility.
Happy Trading !
Nifty State Review for week ended 19 Sep'08
All the global equity markets including ours saw a highly volatile trade. Some of the global equity market went as high as 9 - 10% in a single trading session which could be the craziest we had ever seen. Lot of drama happened in the US market during the week with both negative and positive news at its extremes like Lehman brothers bankruptcy failing, government decision to bail out sick financial institutions and improving liquidity by injecting billion of dollars, etc.
Due to those extreme happenings, US market had a very volatile trading sessions throughout the week and in the same time it has not failed to influence the world market to dance to its tunes. Nifty also traded in a wide range with 3800 on the lower side and 4263 on the higher side for the week. Nifty touched its previous July'08 low at around 3800 and bounced heavily by recovering almost 200 points on the same day itself to close at 4038 on Thursday. On Friday nifty opened with a huge gap up influenced by global market and closed to gain more than 5%.
It is true that in a bear market there would be sharp dead cat bounces, but last week bounce doesn't seems to be dead cat bounce rather a live cat bounce. Such behaviours confuses even a seasoned trader. One day it falls as if the sky is falling and the other day moves up as if sky is the limit.
For week starting 22 Sep'08 we can expect some interesting and important things to happen. This week may be important for the reason that this week's action will give some guidance on the direction of the trend in near future. Either the ongoing momentum can continue to break past the important resistances or it may fall due to possible profit booking at higher levels and breach the establish support last week at around 3800 to a new low.
Due to those extreme happenings, US market had a very volatile trading sessions throughout the week and in the same time it has not failed to influence the world market to dance to its tunes. Nifty also traded in a wide range with 3800 on the lower side and 4263 on the higher side for the week. Nifty touched its previous July'08 low at around 3800 and bounced heavily by recovering almost 200 points on the same day itself to close at 4038 on Thursday. On Friday nifty opened with a huge gap up influenced by global market and closed to gain more than 5%.
It is true that in a bear market there would be sharp dead cat bounces, but last week bounce doesn't seems to be dead cat bounce rather a live cat bounce. Such behaviours confuses even a seasoned trader. One day it falls as if the sky is falling and the other day moves up as if sky is the limit.
For week starting 22 Sep'08 we can expect some interesting and important things to happen. This week may be important for the reason that this week's action will give some guidance on the direction of the trend in near future. Either the ongoing momentum can continue to break past the important resistances or it may fall due to possible profit booking at higher levels and breach the establish support last week at around 3800 to a new low.
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