Look out to buy the Nifty on dips, as the up-trend is still intact
As discussed yesterday, the up and above direction on the Nifty continued unabated, even after the rough shock on the cancellation of 2G licenses. The Nifty managed to close with gains of 34 points. Today, given the global cues, the Nifty is likely to open flat.
1) The Elder Ray readings : Bull Power increases from +172 to +189 Bear Power reduces from +86 to +125, showing clearly that the Bears are overshadowed by the Bulls, and any dips in the market will be bought out swiftly.
2) The Nifty is trading well above all its key EMAs and key DMAs, indicating that the up trend is still intact. However, looking at the steep gradient, it suggests, that we have come up too far too fast, and caution needs to be exercised.
3) The stochastics are deep in the overbought zone, and a mild correction cannot be ruled out at this stage.
4) In the above chart, the volumes have increased yesterday, however the Nifty has formed a "doji" in the supply zone, indicating exhaustion of the current up-trend. the MACD too is peaking and the ADX is suggesting non sustainability of the up-move. However, the ADX is also indicating that the Bears are losing out on momentum consistently.
5) Considering the above, our trading plan for the day is as under,
a) Below 5305, we will open fresh short positions with a SL of 5335 and a target of 5230. We will add to these short positions only below 5205.
b) Above 5240, we will open fresh long positions with a SL of 5225 and a target of 5310. We will add to these long positions only above 5340.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed yesterday, the up and above direction on the Nifty continued unabated, even after the rough shock on the cancellation of 2G licenses. The Nifty managed to close with gains of 34 points. Today, given the global cues, the Nifty is likely to open flat.
1) The Elder Ray readings : Bull Power increases from +172 to +189 Bear Power reduces from +86 to +125, showing clearly that the Bears are overshadowed by the Bulls, and any dips in the market will be bought out swiftly.
2) The Nifty is trading well above all its key EMAs and key DMAs, indicating that the up trend is still intact. However, looking at the steep gradient, it suggests, that we have come up too far too fast, and caution needs to be exercised.
3) The stochastics are deep in the overbought zone, and a mild correction cannot be ruled out at this stage.
4) In the above chart, the volumes have increased yesterday, however the Nifty has formed a "doji" in the supply zone, indicating exhaustion of the current up-trend. the MACD too is peaking and the ADX is suggesting non sustainability of the up-move. However, the ADX is also indicating that the Bears are losing out on momentum consistently.
5) Considering the above, our trading plan for the day is as under,
a) Below 5305, we will open fresh short positions with a SL of 5335 and a target of 5230. We will add to these short positions only below 5205.
b) Above 5240, we will open fresh long positions with a SL of 5225 and a target of 5310. We will add to these long positions only above 5340.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
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