TURNING POINTS FOR 11.02.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD

NIFTY FUTURE :

One more day of fall and new items getting weak viz. SBI & Infosys. Today Nifty Future opened weak and went down to make the day's low of 5210 and made an attempt to turn around and went up, to make the day's high of 5385. But that's all the strength for the day and by the end of the day, all the gains were lost to close the day at 5230. Well, just like a snake & ladder game.

Today's close being near the low of the day, down side is not yet capped and one needs to be prepared to see some more, if 5190 is broken. While looking for some more reasons for support, I came across a very small gap (Rs. 0.25) at 5138 on the weekly as well as EOD chart (please refer chart). Once this is filled, we would have filled all the gaps up to a previous low of 4786. This coupled with the neckline support at 5100 can act as a good support for a sharp bounce. Once again, the brave hearts can take long position in the event of further fall, with a strict stop loss of 5090.

This week, we had all the days making lower top / lower bottom and tomorrow is Friday -last day of the week. In the event of further fall and close near the day's low, we have a very weak candle for the week, which does not give any good indications for the next week. Conversely, if the market has to bottom out this week, tomorrow we must have a sharp up move - with or without a new low.

On the higher side, 5300 - 5330 - 5385 and 5400 will act as hurdles on the way up. As such, only the close above 5350 can provide positive signals for the next week.

Once again, I can not but resist the temptation of mentioning about the merits of taking trading guidance from the TP Grid. Pull back in Bank Nifty provided good trade up to 10272. I am sure all those who are referring to it and taking trades based on it will have less to regret even in this sharp down move. For others, its never too late to change to a good method.

Put Call Ratio of Index Options went down to 0.84 as against 0.90 yesterday.

PLEASE DO NOT TRADE WITHOUT STOP LOSS.
With Best Wishes,
Ketan Asher.

PS: Something special about tomorrow's date : 11022011 and it all adds up to 8! Will it provide a good buy signal for the next week? To know - stay tuned to the market and also put your stop losses tight.