Nifty may witness wild swings as both Bulls and Bears try to grab control.
As discussed yesterday, selling continued on the Nifty, almost from the start and throughout the session yesterday, with the Nifty just managing to close in the positive, after a gap up opening. Today, the Nifty is likely to open in the negative, but as it approaches key support levels, the volatility is likely to increase.
1) The Elder Ray readings : Bull Power increases from -19 to +52 Bear Power reduces from -104 to -54, indicating that the Bulls and the Bears are now equidistant and safe in their own territory. This will give rise to volatility as each one will try to gain control on the markets.
2) The Nifty is trading below its 8 and 13 EMAs however it is above its 21 EMA and all its key DMAs. The 200 DMA is falling now.
3) The stochastics are just out of the oversold zone, but are not pointing upwards.
4) In the above chart, the volumes are on the lower side as the Nifty consolidates. The MACD continues to show negative bias. The ADX is giving out signals of a possible up move. However, the Parabolic SAR is showing that the resistances are getting lower. All these put together indicate a highly volatile session ahead of us.
5) The Nifty future premium is extremely high and is unsustainable for a long time now. This makes it additionally difficult for long positions as the premium may drop while the Nifty rises.
6) Considering the above, our trading plan for the day is as under
a) Around 5340, we will open fresh long positions with a SL of 5325 and a target of 5415. We will add to these long positions only above 5465.
b) Around 5445, we will open fresh short positions with a SL of 5465 and a target of 5350. We will add to these short positions only below 5330.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed yesterday, selling continued on the Nifty, almost from the start and throughout the session yesterday, with the Nifty just managing to close in the positive, after a gap up opening. Today, the Nifty is likely to open in the negative, but as it approaches key support levels, the volatility is likely to increase.
1) The Elder Ray readings : Bull Power increases from -19 to +52 Bear Power reduces from -104 to -54, indicating that the Bulls and the Bears are now equidistant and safe in their own territory. This will give rise to volatility as each one will try to gain control on the markets.
2) The Nifty is trading below its 8 and 13 EMAs however it is above its 21 EMA and all its key DMAs. The 200 DMA is falling now.
3) The stochastics are just out of the oversold zone, but are not pointing upwards.
4) In the above chart, the volumes are on the lower side as the Nifty consolidates. The MACD continues to show negative bias. The ADX is giving out signals of a possible up move. However, the Parabolic SAR is showing that the resistances are getting lower. All these put together indicate a highly volatile session ahead of us.
5) The Nifty future premium is extremely high and is unsustainable for a long time now. This makes it additionally difficult for long positions as the premium may drop while the Nifty rises.
6) Considering the above, our trading plan for the day is as under
a) Around 5340, we will open fresh long positions with a SL of 5325 and a target of 5415. We will add to these long positions only above 5465.
b) Around 5445, we will open fresh short positions with a SL of 5465 and a target of 5350. We will add to these short positions only below 5330.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
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