Volatile day ahead
As discussed yesterday, Nifty traded for the entire session in the "No trade zone" as defined by this blog, leaving the common trader clueless about the direction of trade. After opening at 5139, the nifty traded for most of the session in the negative, but the bears could not take it below 5090 and the bulls then took the charge, but could not take the nifty past 5170. Here again, some profit booking was witnessed and 5153 with a small gain of 28 points.
1) This is again evident from the Elder Ray readings. Bull Power reduced slightly from +137 to +132 whereas the Bear Power also reduced +59 to +61 ( Bear power in positive indicates weakness of bears). This shows that the bulls are looking tired and the bears are still not ready to strike.
2) The ATR has reduced now from 130 to 114 in the past few trading sessions, suggesting indecision by both the bulls and the bears.
3) The simple moving averages continue to fall and the stochastics still are in the overbought zone, indicating that a bearish wave cannot be ruled out.
4) In the above chart, the bollinger bands are just starting to expand, indicating volatility increasing in coming sessions.
5) We continue to hold our view of yesterday that in these times of uncertainty, it is better to be on the sidelines till a fresh signal and direction emerges. The new direction will be indicated only when either the bulls are able to take the nifty past 5170 or the bears are able to take the nifty below 5090. The "No trading zone" still persists.
Happy Trading.
As discussed yesterday, Nifty traded for the entire session in the "No trade zone" as defined by this blog, leaving the common trader clueless about the direction of trade. After opening at 5139, the nifty traded for most of the session in the negative, but the bears could not take it below 5090 and the bulls then took the charge, but could not take the nifty past 5170. Here again, some profit booking was witnessed and 5153 with a small gain of 28 points.
1) This is again evident from the Elder Ray readings. Bull Power reduced slightly from +137 to +132 whereas the Bear Power also reduced +59 to +61 ( Bear power in positive indicates weakness of bears). This shows that the bulls are looking tired and the bears are still not ready to strike.
2) The ATR has reduced now from 130 to 114 in the past few trading sessions, suggesting indecision by both the bulls and the bears.
3) The simple moving averages continue to fall and the stochastics still are in the overbought zone, indicating that a bearish wave cannot be ruled out.
4) In the above chart, the bollinger bands are just starting to expand, indicating volatility increasing in coming sessions.
5) We continue to hold our view of yesterday that in these times of uncertainty, it is better to be on the sidelines till a fresh signal and direction emerges. The new direction will be indicated only when either the bulls are able to take the nifty past 5170 or the bears are able to take the nifty below 5090. The "No trading zone" still persists.
Happy Trading.
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