NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE :
In today's trading, Nifty Future opened weak and maintained downward bias throughout the day, with last one hour seeing a panic like situation once 5850 was broken. During the day Nifty Future made a high of 5941 and low of 5757. It closed weak at 5780 and has come out of the Andrew's Pitchfork for the 1st time after 25.5.2010 as seen on the EOD chart.
Bank Nifty continued to bleed continuously for the 5th day and has made a low of 11102 - an important support level it being a mid-point of a major swing on the EOD chart.
I expect Bank Nifty to take support at this level - at least for a pullback.
When Nifty Future and Bank Nifty Future have taken such a thrashing in the past few days, it is best not to speak or even look at the so called mid-cap or momentum stocks.
While there is no denying that fall today has been quite sharp not because any such damaging event has taken place today, but more people are now feeling jittery of Nifty Future being able to sustain the up move. If you have noticed yesterday's EOD chart, I have marked the area of 6400 and 6000 in yellow shading. Please have a look at the EOD chart for today, and you will find that 6000 level looks quite far now. In any case, 6000 will now act as a major resistance on the upside.
We are now close to the previous low of 5727 and it is quite likely that Nifty Future may take support at this level. Hence it is advisable to avoid fresh short position and also square off short positions. In the event of a weak opening, at the 1st sign of market stabilising, one can consider going long with a strict stop loss of 5675. On the higher side, it will find resistance at 5850 - 5890 and strong resistance at 5925. Tomorrow also happens to be last day of the week, hence a pullback will not be out of place. If fall like today has to continue, weekly candle will go for a toss - in any case there are no events indicating to such a grim scenario - at least for now. Banks look quite promising for a pullback and 10700 should act as a good stop loss level for fresh long positions.
Put Call Ratio of Index Options decreased to 0.96 as against 1.01 yesterday.
Please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.
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