TURNING POINTS FOR 12.08.2010

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
CRITICAL LEVELS:
LEVEL 1: 5365, LEVEL 2:5225 & LEVEL 3:4800
NIFTY FUTURE :

After opening weak Nifty Future could go up to make a high of 5468 and there after maintained a downward bias and in the last one hour made a low of 5404 and closed at 5412. Main feature of today's fall is that it has broken out of the Rising Wedge being shown on the EOD chart. What this means is that we will have a sharp & swift correction.

At the time of writing, Dow is down 225 points and hence a good possibility of a gap down opening. Today's fall is also a good lesson (in real-time) for those learning TA as this is a typical pattern happening on the right side of the chart - unlike the left side of the chart used for classroom purposes. Incidentally, this will be accompanied with pain, in case you have open long positions.

In case of gap down opening, it is best not to do anything. In case market gives an opportunity, one can go short with stop loss of 5425. On the down side, break of 5390 will take it to 5365 and 5300. it may get support at this level but advisable not to try bottom fishing so early. In case of sharp bounce, it can come up to 5365, where one can go short.
Put Call Ratio of Index Options remained at 1.12 as against 1.22 yesterday.

Please do not trade without STOP LOSS.

With Best Wishes.

Ketan Asher.