AD Code

Tuesday 27 November 2012

Nifty - 27 Nov 2012 - Range Squeeze Continues

Nifty continues to get squeezed in a tight range bringing it to a no trade zone.

In our yesterday's post, we had suggested Nifty may turn volatile due to expiry jitters. However, the markets chose to remain sideways in a even tighter trading range, with the Nifty again closing below its opening mark although with a minor positive above its previous close. None of our trading plans got triggered as the Nifty now moved into a no trading zone.

1) The Elder Ray readings : Bull Power rises from +3 to +14 Bear Power reduces from -41 to -11 indicating that both the Bulls and the Bears are equidistant and safe in their respective territories. For today, the Bulls need to overcome the levels of 5655 to maintain their upwards momentum whereas the Bears need to breach the levels of 5620 to maintain their downwards momentum.

2) The Nifty has now closed above its 8EMA and also its 13EMA however it is below its 21EMA. The Nifty is above its 100DMA and also its 200DMA, however it is below its 50DMA.

3) The stochastics are having a slight look up from the oversold zone.

 


4) In the above chart, the volumes remain on the lower side with the Nifty being in a tight range, indicating further tightening of the trading range. The MACD is showing a slight positive divergence. The ADX is suggesting equal weight-age for both the up-move as well as the down-move with a falling momentum. The Parabolic SAR continues with its Buy signal.

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

a) Around 5605 we will open fresh long positions with a SL of 5590 and a target of 5660. We will add to these long positions only above 5680.

b) Around 5665 we will open fresh short positions with a SL of 5680 and a target of 5625. We will add to these short positions only below 5590.

Happy Trading !!!


Also visit Just Nifty and the Nifty Range blogs.


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