Oversold Nifty respects key supports but fails below key resistances.
As discussed yesterday, the Bearish sentiment remained intact, despite the Nifty attempting a pull back above 5950. The Nifty opened with a negative gap of 29 points and rapidly moved downwards into our identified support area of 5870, from where the bounce back started and took the Nifty over to 5920 and above that to 5957 from where again a sell off emerged and the Nifty closed at 5921 with a loss of 3 points. In the mean time, the moving averages now have stacked up in favor of the Bears. Both our trading plans triggered and we were able to book a profit of 50 points in three trades taken yesterday.
1) The Elder Ray readings : Bull Power rises from -78 to -43 Bear Power also rises from -129 to -130 indicating that with the failed bounce back attempt, the Bulls are still out of their safe zone. For today, the Bulls need to overcome the levels of 5995 to regain their lost grounds whereas the Bears need to breach the levels of 5865 to maintain their downwards momentum.
2) The stochastics are still in the oversold zone, but now they could be confirming the downtrend.
3) The Nifty has closed below all its key EMAs but has closed above all its key DMAs. However, it should be noted that now the key EMAs are stacked inversely and are favoring the Bears.
4) In the above chart, the volumes remain muted with the rise in the Nifty indicating that the rise may stall shortly. The MACD continues to fall with the histogram continuing to remain in the negative. The ADX is suggesting a fall in the momentum for the Bears but is still favoring a down move. The Parabolic SAR continues with its Sell signal with a SL now pegged at 6099.
5) Considering the above, our trading plan for the day is as under.
a) Around 5970 we will open fresh short positions with a SL of 5995 and a target of 5880. We will add to these short positions only below 5850.
b) Around 5870 we will open fresh long positions with a SL of 5850 and a target of 5920. We will add to these long positions only above 5995.
Happy Trading !!!
Also visit Just Nifty and the Nifty Range blogs.
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed yesterday, the Bearish sentiment remained intact, despite the Nifty attempting a pull back above 5950. The Nifty opened with a negative gap of 29 points and rapidly moved downwards into our identified support area of 5870, from where the bounce back started and took the Nifty over to 5920 and above that to 5957 from where again a sell off emerged and the Nifty closed at 5921 with a loss of 3 points. In the mean time, the moving averages now have stacked up in favor of the Bears. Both our trading plans triggered and we were able to book a profit of 50 points in three trades taken yesterday.
1) The Elder Ray readings : Bull Power rises from -78 to -43 Bear Power also rises from -129 to -130 indicating that with the failed bounce back attempt, the Bulls are still out of their safe zone. For today, the Bulls need to overcome the levels of 5995 to regain their lost grounds whereas the Bears need to breach the levels of 5865 to maintain their downwards momentum.
2) The stochastics are still in the oversold zone, but now they could be confirming the downtrend.
3) The Nifty has closed below all its key EMAs but has closed above all its key DMAs. However, it should be noted that now the key EMAs are stacked inversely and are favoring the Bears.
4) In the above chart, the volumes remain muted with the rise in the Nifty indicating that the rise may stall shortly. The MACD continues to fall with the histogram continuing to remain in the negative. The ADX is suggesting a fall in the momentum for the Bears but is still favoring a down move. The Parabolic SAR continues with its Sell signal with a SL now pegged at 6099.
5) Considering the above, our trading plan for the day is as under.
a) Around 5970 we will open fresh short positions with a SL of 5995 and a target of 5880. We will add to these short positions only below 5850.
b) Around 5870 we will open fresh long positions with a SL of 5850 and a target of 5920. We will add to these long positions only above 5995.
Happy Trading !!!
Also visit Just Nifty and the Nifty Range blogs.
For cash market recommendations see our Daily Pre Market calls on NSE
Opened fresh short position at 5965 with a SL of 5990 a small variation from trading plan (a)
ReplyDeleteSquared off short positions at 5925 with a profit of 40 points
ReplyDeleteExcellent analysis.Congrates.Only thing i want to know that NIFTYSPOT OR FUTURE YOUMENTIONING?
ReplyDeleteAll are Nifty spot
Delete