With the Nifty likely to open higher, the mantra will be 'sell on rise'.
As discussed in our last post, the Nifty opened gap down, and then traded in the negative. All throughout the day, it whipsawed between 5240 and 5170 ( which is the 200DMA) before closing flat. Today, given the global cues, the Nifty is likely to open with a nice positive gap up, but will have to survive bouts of selling at higher levels, which if it crosses, then a new Bull Run could be starting. But if it fails, then the Bears will get charged up, and we could see the Nifty drifting downwards.
1) The Elder Ray readings : Bull Power reduces from +32 to -88 Bear Power increases from -144 to -160, indicating that the Bulls are now a weakened lot, and any up gaps would be quickly sold into, unless the Bulls stage a spectacular comeback.
2) The Nifty is still trading between its key EMAs and key DMAs. All the 3 key EMAs are now clustered at around 5320, which can be used as a major resistance point for the Nifty.
3) The stochastics are deeply into the oversold zone, indicating that the short term bearish move has not ended yet.
4) In the above chart, the volumes have decreased on the last day, indicating lack of participation. The MACD is still in the positive and is declining, confirming the short term bear run. The ADX is also indicating strengthening of a down move and weakening of the up-move. The Parabolic SAR is still confirming its sell signal.
5) Considering the above, our trading plan for the day is as under
a) Around 5320, we will open fresh short positions with a SL of 5350 and a target of 5220. We will add to these short positions only below 5200.
b) Above, 5355, we will open fresh long positions with a SL of 5325 and a target of 5410.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed in our last post, the Nifty opened gap down, and then traded in the negative. All throughout the day, it whipsawed between 5240 and 5170 ( which is the 200DMA) before closing flat. Today, given the global cues, the Nifty is likely to open with a nice positive gap up, but will have to survive bouts of selling at higher levels, which if it crosses, then a new Bull Run could be starting. But if it fails, then the Bears will get charged up, and we could see the Nifty drifting downwards.
1) The Elder Ray readings : Bull Power reduces from +32 to -88 Bear Power increases from -144 to -160, indicating that the Bulls are now a weakened lot, and any up gaps would be quickly sold into, unless the Bulls stage a spectacular comeback.
2) The Nifty is still trading between its key EMAs and key DMAs. All the 3 key EMAs are now clustered at around 5320, which can be used as a major resistance point for the Nifty.
3) The stochastics are deeply into the oversold zone, indicating that the short term bearish move has not ended yet.
4) In the above chart, the volumes have decreased on the last day, indicating lack of participation. The MACD is still in the positive and is declining, confirming the short term bear run. The ADX is also indicating strengthening of a down move and weakening of the up-move. The Parabolic SAR is still confirming its sell signal.
5) Considering the above, our trading plan for the day is as under
a) Around 5320, we will open fresh short positions with a SL of 5350 and a target of 5220. We will add to these short positions only below 5200.
b) Above, 5355, we will open fresh long positions with a SL of 5325 and a target of 5410.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
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