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Tuesday 25 September 2012

Nifty - 25 Sep 2012 - Bulls still hold the sway

After a healthy consolidation, Bulls still in the driving seat. Up move to continue.

As discussed yesterday, we expected the up move to march onwards. However, the markets chose to consolidate and a small bout of profit booking appeared. The Nifty remained range bound for the entire day, without giving up much of the gains and closed with a loss of 22 points. Our trading plan(a) got triggered late in the afternoon, and we could book a small profit of 15 points.

1) The Elder Ray readings : Bull Power reduces from +227 to +192 Bear Power also reduces from +83 to +145, indicating the inherent weakness amongst the Bears as of now. For today the Bulls need to overcome the levels of 5735 on the Nifty to retain their upwards momentum, whereas the Bears need to breach the levels of 5535 on the Nifty to regain their lost grounds.

2) The Nifty remains above all its key EMAs and also above all its key DMAs.

3) The stochastics continue to remain in the overbought zone.

 


4) In the above chart, the volumes have decreased with a small fall in the Nifty, indicating of a healthy consolidation. The MACD continues to rise, with the histogram indicating a pause. The ADX is still favoring the Bulls, with a rising momentum. The Parabolic SAR continues with its buy signal with the SL now pegged at 5530.

5) Considering the above, our trading plan for the day is as under.

a) Around 5630, we will open fresh long positions with a SL of 5615 and a target of 5690. We will add to these long positions only above 5725.

b) Around 5715, we will open fresh short positions with a SL of 5725 and a target of 5665. We will add to these short positions only below 5615.

Happy Trading !!!

Also check out Just Nifty and The Nifty Range blogs. 

For cash market recommendations see our Daily Pre Market calls on NSE

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