NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE :
Contrary to general expectations, Nifty Future did not show any positive bias in the opening session mainly due to weak opening of Maruti - due to lower quarterly profits. Weakness persisted throughout the day with Nifty Future making low of 5417 and closed at 5423. Reliance continued to show weakness even today.
Another significant change that has taken place this week is - that due to passage of time, Nifty 52 week low that was 3905 till last week has now become 4341. What this means is that mid-point level (indicating balance) now stands at 4908. While as of today we are above this level, the next time when we move below this level - the bearishness will accelerate. Similar mid point level for Reliance stands at 1051 and today's low was 1050. This level should be of significance tomorrow, as the Company's quarterly results will be announced. Moreover, tomorrow is also date for RBI credit policy and this together may make it a volatile day.
For tomorrow, one can consider going long only above 5460 with stop loss of 5420. On higher side it will find resistance at 5475 - 5515. This will be possible only if , Reliance remains above 1071.
As we are close to the trend line support at 5400 we need to avoid short position near this levels, as market can take support and bounce back, in the event of some positive features in the RBI Credit policy or better than expected Reliance results. If 5400 is broken, we have 5350 level which may provide support, but as we will be below the trend line, market may become weak.
Effective today, I will be giving 3 different levels, below which weakness will accelerate. The purpose of these levels is to help you prepare for life below 5000 in the coming weeks/months. Taking leaf out of what happened to Maruti today (down 10%), please do not think they are too far away to worry.
Level 1 - 5369, Level 2 - 5225 and Level 3 - 4800. At each of these levels support can be expected at least once.
Various indicators suggest that market may not be able to sustain higher levels and hence delivery based selling is advised. While there may not be any reasons apparent today, they can always develop over a period of time.
Put Call Ratio of Index Options decreased to 1.15 as against 1.56 on the previous trading day.
Please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.
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