Nifty - 30 Jul 2014 - Bulls losing grip

Bulls are losing their grip on the Nifty slowly, yet Bears not looking strong either.

As discussed in our Friday's post "Bulls hold advantage", the Bulls after opening the Nifty in the green and sustaining the green for the first hour of trade, let loose their grip and let the Nifty breach previous two day's low, only to recover somewhat in the last hour of trade and keeping themselves in the run as yet. The Nifty opened at 7793, made a high of 7800 and then dipped to 7723, recovered to 7762 before closing at 7749 with a loss of 51 points against its previous close. We took a trade on the long side as per our trading plan and could book out with a profit of 25 points on that trade.

1) The Elder Ray readings : Bull Power reduces from +144 to +96 Bear Power rises from +52 to +19 indicating that though the Bulls are losing that grip, the Bears are yet to take advantage. For today, the Bulls need to overcome the levels of 7805 to maintain their upwards momentum, whereas the Bears need to breach the levels of 7710 to regain their lost grounds.

2) The stochastics continue to remain in the overbought zone and continue to point  downwards.  

3) The Nifty continues to close above all its key EMAs and also above all its key DMAs.

 

4) In the above chart, the volumes have decreased with the fall in the Nifty indicating that the fall may get arrested. The MACD continues to point horizontal, but positive, with the histogram remaining in the positive, but reducing. The ADX is suggesting a fall in the Bullish momentum but still favors the Bulls. The Parabolic SAR continues with its Buy call with the SL now brought up to 7566.

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

a) Around 7805 we will open fresh short positions with a SL of 7825 and a target of 7710. We will add to these short positions only below 7675.

b) Around 7700 we will open fresh long positions with a SL of 7675 and a target of 7800. We will add to these long positions only above 7825.

Happy Trading !!! 

Sell call on SUNTV hits its target of 28 Jul 2014

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