Bullish trend might continue after a gap up opening
As discussed in our last post, the Nifty remained precariously poised at the lower end of its current trading range. After having a strong opening at 4791 and trading in the green till 4828 in the morning session, the Nifty lost all of its gains and closed at 4751 after hitting a day low of 4741. Today, riding on the global cues, Nifty may have a 100 point gap up opening. But then what? Lets analyze this a bit closely.
1) The Elder Ray readings : Bull power reduced from -65 to -80, Bear power also reduced from -206 to -167. This reaffirms a minor bullish trend within a major bearish trend. Bulls have been under water, and may come up for breath.
2) The moving averages continue to point downwards, confirming a major bearish trend. However, there is a gap between 4880 and 4920 which can be filled, without really changing the moving averages direction.
3) The stochastics have now fully entered the oversold zone, and indicate the possibility of some buying coming into play.
4) From the chart above, we can see that the MACD is falling, and the ADX shows a weakening bearish run. Contradictory signals those.
5) As we write this post, the SGX Nifty is trading about 120 points above our last close.
6) Considering the above, our trading plan for the day is as under.
a) We will try to sell the gaps, by looking out to open short positions around 4920 with a SL of 4950 and a target of 4820. We will add to these shorts, only below 4790.
b) If we get the opportunity before the Nifty touches 4920, to buy around 4850, then we might open long positions at 4850 with a SL of 4810 and a target of 4910. But this step is only before the market touches 4920 levels and not before that.
Today's trading range expected within 4810 4930
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed in our last post, the Nifty remained precariously poised at the lower end of its current trading range. After having a strong opening at 4791 and trading in the green till 4828 in the morning session, the Nifty lost all of its gains and closed at 4751 after hitting a day low of 4741. Today, riding on the global cues, Nifty may have a 100 point gap up opening. But then what? Lets analyze this a bit closely.
1) The Elder Ray readings : Bull power reduced from -65 to -80, Bear power also reduced from -206 to -167. This reaffirms a minor bullish trend within a major bearish trend. Bulls have been under water, and may come up for breath.
2) The moving averages continue to point downwards, confirming a major bearish trend. However, there is a gap between 4880 and 4920 which can be filled, without really changing the moving averages direction.
3) The stochastics have now fully entered the oversold zone, and indicate the possibility of some buying coming into play.
4) From the chart above, we can see that the MACD is falling, and the ADX shows a weakening bearish run. Contradictory signals those.
5) As we write this post, the SGX Nifty is trading about 120 points above our last close.
6) Considering the above, our trading plan for the day is as under.
a) We will try to sell the gaps, by looking out to open short positions around 4920 with a SL of 4950 and a target of 4820. We will add to these shorts, only below 4790.
b) If we get the opportunity before the Nifty touches 4920, to buy around 4850, then we might open long positions at 4850 with a SL of 4810 and a target of 4910. But this step is only before the market touches 4920 levels and not before that.
Today's trading range expected within 4810 4930
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
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