TURNING POINTS FOR 15.09.2010

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD

NIFTY FUTURE:

In today's trading Nifty Future opened strong and made a new high at 5845 and corrected to make a low of 5778 and then remained stable to close at 5812. In making the new high at 5845, market has provided some more maths, which is as follows:

On EOD chart previous high = 5543
Less: Recent low = 5356 + (187 x 2.618=489) = 5845

In view of the above, I am inclined to suggest that existing long positions are better liquidated as Nifty Future should see a correction, before continuing its upward march. If you are still looking for upside you will do well to keep a tight stop loss of 5750.

Those who are willing to take some risk may buy puts of 5500/5600 strike price which is having the last traded price of Rs. 15.45/24, as going short with naked future may be a risky proposition at this stage. Unless Nifty future moves below the trend line on EOD chart at 5700, possibility of the up move continuing after a pause/correction can not be ruled out.

The correction can come down till the previous low of 5543 and only close below 5543 should be considered as a serious threat to this up move.

Put Call Ratio of Index Options decreased to 0.92 as against 1.02 on the previous day.
Please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.