MARKET VIEW FOR 12.6.2009

At the outset my apologies for not posting my comments for the last 2 days, due to some technical problems in Googles system vis-a-vis this blog. In these two days, market has been maintaining upward momentum and having daily range of about 100 points. The way market has pulled back from the lows, clearly indicates buying at lower levels - irrespective of the Technicals.

Tomorrow, above 4700, Nifty future may go up to 4750-4765. Assuming that buying support is enough to disregard the important levels indicated in the Weekly Futures chart, discussed later, it can even go higher. It is worth noting that above 4700, NIfty Future will be traversing the same levels which Nifty Future had on 2.6.08 i.e. High of 4896 and Low of 4693. If it can fall so much, it can also rise so much - in a day. So be prepared for a good ride, if the market decides to go above 4700 tomorrow.

4540 should be used as stop loss to liquidate long postions, based on high of 4696. If this level is broken on the upside tomorrow, the stop loss should accordingly be increased.

I have also attached a weekly chart with couple of Trend lines and .618 and 2/3rd levels from 6336 and 2228. You will find that all these levels are in the range of 4700 to 5000. Is the market TOP somewhere here? May be .... because even weekly 14 day RSI is much above 80. Since market can remain overbought for quite some time, it is not advisable to go short on the market, but at least keep booking profit and it will also be prudent not to add any new long postions at these levels.
For reasons stated above, although i have attached the chart of Reliance and Infosys, i would not recommed making new trading buys.

Happy & Profitable Trading,

Ketan Asher.

PS: All those who attended last week's workshop may find it interesting to note that today, market made a low of 4691.05 which is on Sq of 9 and was also very close to Monday open of 4690.