Nifty - 18 May 2012 - Gap down to aid bears

The bearish move likely to get a fillip aided by weak global cues.

As discussed yesterday, we saw the Whipsaw enter into the Nifty, with the Nifty opening with a nice little gap up, then rising up and then giving away almost all the gains, before a little rally that closed the Nifty with a minor gain. Today, given the global turmoil, the Nifty is likely to open with a gap down and stay down for most of the trading session.

1) The Elder Ray readings : Bull Power rises from -137 to -76 Bear Power reduces from -182 to -148, indicating that the Bears are still driving the Nifty, in-spite of valiant efforts by the Bulls to fight back. For today, the Bulls need to overcome 4980 to return back into their zone, whereas the Bears need to breach below 4830 to retain their downward momentum.

2) The Nifty is trading well below its key EMAs and its key DMAs. Look out for a cross over of 50 and 100 DMAs within the next few trading sessions, which if happens might drag the Nifty to even lower levels, where the Bears will get exhausted for a while.

3) The stochastics are well and truly in the deep oversold zone. However, in a strongly trending market as this one, we look at it as a confirmatory signal rather than as a reversal signal.

4) In the above chart, the volumes have remained dull in the minor rise for the Nifty, making the rise unsustainable indicatively. The MACD continues to fall down. The ADX is also suggesting a bias towards the bearish down move. The Parabolic SAR is still holding onto its sell signal.

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

a) Below 4880, we will open fresh short positions with a SL of 4905 and a target of 4780. We will add to these short positions only below 4760.

b) Above 4770, we will open fresh long positions with a SL of 4760 and a target of 4835 and above that 4880. We will add to these long positions only above 4905.

Happy Trading !!! 

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

Nifty - 18 May 2012 - Gap down to aid bears

The bearish move likely to get a fillip aided by weak global cues.

As discussed yesterday, we saw the Whipsaw enter into the Nifty, with the Nifty opening with a nice little gap up, then rising up and then giving away almost all the gains, before a little rally that closed the Nifty with a minor gain. Today, given the global turmoil, the Nifty is likely to open with a gap down and stay down for most of the trading session.

1) The Elder Ray readings : Bull Power rises from -137 to -76 Bear Power reduces from -182 to -148, indicating that the Bears are still driving the Nifty, in-spite of valiant efforts by the Bulls to fight back. For today, the Bulls need to overcome 4980 to return back into their zone, whereas the Bears need to breach below 4830 to retain their downward momentum.

2) The Nifty is trading well below its key EMAs and its key DMAs. Look out for a cross over of 50 and 100 DMAs within the next few trading sessions, which if happens might drag the Nifty to even lower levels, where the Bears will get exhausted for a while.

3) The stochastics are well and truly in the deep oversold zone. However, in a strongly trending market as this one, we look at it as a confirmatory signal rather than as a reversal signal.

Nifty - 17 May 2012 - Enter the Whipsaw

With technicals in the oversold zone, the overtly bearish Nifty may whipsaw wildly.

Yesterday, we had said,"The rally may not sustain", and what we got is a huge gap down of 68 points and then the Nifty never looked like regaining strength till reaching 4837, where a mild rally to 4882 fizzled out quickly, and the Nifty closed at 4858. Today, again we may get a flat to positive opening, and then the Nifty is expected to gyrate wildly between 4800 and 4920, and we need to be nimble footed and brave-hearted at the same time, which is a difficult task.

1) The Elder Ray readings : Bull Power reduces from -91 to -137 Bear Power increases from -177 to -182, indicating that the Bulls are losing steam at a greater pace than the Bears are gaining momentum. For today, the Bulls need to overcome 4995 to regain their lost grounds whereas the Bears need to breach the Nifty below 4810 to maintain their momentum. 

2) The Nifty is trading well below its key EMAs and its key DMAs. The 50 and 200 DMAs have started accelerating in their falls.

3) The stochastics and the RSI are in the oversold zone, and are trying to look up, which gives the Nifty a probability of trying to bounce back.

4) In the above chart, the volumes are rising with the fall in the nifty indicating sustenance in the downward momentum. The MACD has started its fall again. The ADX is suggesting a strong trend which is favoring the Bears. The Parabolic SAR is continuing with its sell signal.

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

a) Around 4905, we will open fresh short positions with a SL of 4925 and a target of 4810. We will add to these short positions only below 4785.

b) Around 4800, we will open fresh long positions with a SL of 4785 and a target of 4885. We will add to these long positions only above 4925.

Happy Trading !!!  

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


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Nifty - 17 May 2012 - Enter the Whipsaw

With technicals in the oversold zone, the overtly bearish Nifty may whipsaw wildly.

Yesterday, we had said,"The rally may not sustain", and what we got is a huge gap down of 68 points and then the Nifty never looked like regaining strength till reaching 4837, where a mild rally to 4882 fizzled out quickly, and the Nifty closed at 4858. Today, again we may get a flat to positive opening, and then the Nifty is expected to gyrate wildly between 4800 and 4920, and we need to be nimble footed and brave-hearted at the same time, which is a difficult task.

1) The Elder Ray readings : Bull Power reduces from -91 to -137 Bear Power increases from -177 to -182, indicating that the Bulls are losing steam at a greater pace than the Bears are gaining momentum. For today, the Bulls need to overcome 4995 to regain their lost grounds whereas the Bears need to breach the Nifty below 4810 to maintain their momentum. 

2) The Nifty is trading well below its key EMAs and its key DMAs. The 50 and 200 DMAs have started accelerating in their falls.

3) The stochastics and the RSI are in the oversold zone, and are trying to look up, which gives the Nifty a probability of trying to bounce back.

Nifty - 16 May 2012 - Rally may not sustain

In a market that is heavily biased towards Bears, the Bulls fail to rally strong.

Yesterday, we had suggested that "Weekly supports were approaching" and that after a 5 consecutive streak of downturns, a bounce back was likely. The markets obliged, with the Nifty opening lower, but within a blink, rallied past key levels and made a strong attempt at the previous day's high of 5157. However, this failed attempt leads us into believing that the Bears will take inspiration now on, and we may see the downturn resuming. As said in our article, identifying market trends, the bulls need to consistently overcome highs to maintain their momentum.

1) The Elder Ray readings : Bull Power rises from -106 to -91 Bear Power reduces from -189 to -177, indicating that the Bulls have not been able to recover fully, and the Bears have not lost much in yesterday's rally. This also raises doubts on, whether this rally was due to fresh buying or due to short covering.

2) The Nifty continues to trade well below all its key EMAs and its key DMAs.

3) The stochastics are still well & deep into the oversold zone.

 

4) In the above chart, the volumes have remained almost stagnant, raising doubts on the sustenance of this rally. The MACD is showing some positive divergence, but it needs confirmation through a follow up buying of the Nifty. The ADX is indicating a strong trend that has a bearish bias. The Parabolic SAR continues with its sell signal.

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

a) Below 4920, we will open fresh short positions with a SL of 4955 and a target of 4830. We will add to these short positions only below 4810.

b) Around 4820, we will open fresh long positions with a SL of 4810 and a target of 4900. We will add to these long positions only above 4955.

Happy Trading !!!

PS : We acknowledge, that the market operates as it does, because there are multiple views about the price movements in the market. If you have a different opinion, we would like to know about it. Please use the comments box below to let us know your point of view. 


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

Nifty - 16 May 2012 - Rally may not sustain

In a market that is heavily biased towards Bears, the Bulls fail to rally strong.

Yesterday, we had suggested that "Weekly supports were approaching" and that after a 5 consecutive streak of downturns, a bounce back was likely. The markets obliged, with the Nifty opening lower, but within a blink, rallied past key levels and made a strong attempt at the previous day's high of 5157. However, this failed attempt leads us into believing that the Bears will take inspiration now on, and we may see the downturn resuming. As said in our article, identifying market trends, the bulls need to consistently overcome highs to maintain their momentum.

1) The Elder Ray readings : Bull Power rises from -106 to -91 Bear Power reduces from -189 to -177, indicating that the Bulls have not been able to recover fully, and the Bears have not lost much in yesterday's rally. This also raises doubts on, whether this rally was due to fresh buying or due to short covering.

2) The Nifty continues to trade well below all its key EMAs and its key DMAs.

3) The stochastics are still well & deep into the oversold zone.

Nifty - 15 May 2012 - Approaching weekly supports

After 5 consecutive down sessions, a bounce back is likely anytime soon now.

As discussed yesterday, it continued to be "Sell on rise" on the Nifty throughout the session, after the Nifty tried to rally towards previous day's highs. Later in the day, there was confusion all around with the NSE F&O servers giving up and no trades passing through. The reopening of trades added to the confusion, with rates becoming ever so unpredictable. Today, the Nifty is likely to open with a gap down, however, the weekly supports near 4800 may come into play and the Nifty could stage a bounce back from there.

1) The Elder Ray readings : Bull Power increases from -113 to -106 Bear Power also increases from -183 to -189, indicating that the Bears are still driving the Nifty. For today, the Bulls need to overcome 5050 to regain their lost grounds whereas the Bears need to breach below 4860 to maintain their downward momentum.

2) The Nifty is still trading well below its key EMAs and its key DMAs.

3) The stochastics continue to get well and truly deep into the oversold zone.

4) In the above chart, the volumes are stagnating with every fall on the Nifty, indicating exhaustion of the Bears. The MACD is still falling away, the ADX is now indicating a strong trend which is downwards in direction. The Parabolic SAR continues with its sell signal.

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

a) Below 4910, we will open fresh short positions with a SL of 4930 and a target of 4810. We will add to these short positions only below 4780.

b) Around 4810, we will open fresh long positions with a SL of 4785 and a target of 4910. We will add to these long positions only above 4935.

Happy Trading !!! 

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

Nifty - 15 May 2012 - Approaching weekly supports

After 5 consecutive down sessions, a bounce back is likely anytime soon now.

As discussed yesterday, it continued to be "Sell on rise" on the Nifty throughout the session, after the Nifty tried to rally towards previous day's highs. Later in the day, there was confusion all around with the NSE F&O servers giving up and no trades passing through. The reopening of trades added to the confusion, with rates becoming ever so unpredictable. Today, the Nifty is likely to open with a gap down, however, the weekly supports near 4800 may come into play and the Nifty could stage a bounce back from there.

1) The Elder Ray readings : Bull Power increases from -113 to -106 Bear Power also increases from -183 to -189, indicating that the Bears are still driving the Nifty. For today, the Bulls need to overcome 5050 to regain their lost grounds whereas the Bears need to breach below 4860 to maintain their downward momentum.

2) The Nifty is still trading well below its key EMAs and its key DMAs.

3) The stochastics continue to get well and truly deep into the oversold zone.

Nifty - 14 May 2012 - Sell on rally continues

After breaking weakened support levels, it will be sell on rise as of now.

On Friday, we had suggested that "the supports were weakening", and we saw the Nifty open with a 45 point negative gap, then move further down to 4906 before closing at 4929, well below the supports of 4950. Today, given the global cues, the Nifty is likely to open flat and trade in a narrow range with a negative bias.

1) The Elder Ray readings : The Bull Power reduces from -76 to -113 Bear Power increases from -165 to -183, indicating that the Bulls are weakening much faster than the Bears are strengthening, and hence any rallies should be used to create fresh short positions. For today, the Bulls need to overcome 5090 to return back to their zone, whereas the Bears need to breach 4895 to maintain their downward momentum.

2) The Nifty is trading well below its key EMAs and its key DMAs.

3) The stochastics are well and truly deep into the oversold zone, indicating a bounce back could be round the corner.

4) In the above chart, the volumes have decreased in Friday's trading session, indicating that the Bears might be pausing. The MACD is continuing to fall away. The ADX is giving out a signal of a strengthening downtrend. The Parabolic SAR continues with its Sell Signal.

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

a) Around 4970, we will open fresh short positions with a SL of 4995 and a target of 4890. We will add to these short positions only below 4865.

b) Around 4875, we will open fresh long positions with a SL of 4865 and a target of 4945. We will add to these long positions only above 4995.

Happy Trading !!! 

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

Nifty - 14 May 2012 - Sell on rally continues

After breaking weakened support levels, it will be sell on rise as of now.

On Friday, we had suggested that "the supports were weakening", and we saw the Nifty open with a 45 point negative gap, then move further down to 4906 before closing at 4929, well below the supports of 4950. Today, given the global cues, the Nifty is likely to open flat and trade in a narrow range with a negative bias.

1) The Elder Ray readings : The Bull Power reduces from -76 to -113 Bear Power increases from -165 to -183, indicating that the Bulls are weakening much faster than the Bears are strengthening, and hence any rallies should be used to create fresh short positions. For today, the Bulls need to overcome 5090 to return back to their zone, whereas the Bears need to breach 4895 to maintain their downward momentum.

2) The Nifty is trading well below its key EMAs and its key DMAs.

3) The stochastics are well and truly deep into the oversold zone, indicating a bounce back could be round the corner.