TURNING POINTS FOR 25.10.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
One more failed attempt to cross the much awaited 5200 level. It is so unfortunate that though we are ready, we are missing out the party when the world is rejoicing. May be, its the bad timing of RBI Credit policy and the fear factor of its unpredictability. On the 30 min chart you will find that 5200 level has provided resistance for 5 times. While the 5 times resistance level does mean bad, but the flip side to it is - what when it finally gets cleared? To sum up, I remain optimistic of the break out and if there are no surprises in the RBI credit policy announcements today, it will provide the necessary trigger for the breakout.
For today, one can consider going long with stop loss of 5050. On the higher side, it will find resistance at 5130 and 5185. It is not advisable to remain short above 5185.
I would not recommend fresh short position for two reasons viz. There are number of supports at lower level at 5000 and 4940 which will hold the market without disturbing the structure of the market. Secondly, there is a good possibility that in case the RBI policy is even less hawkish than the earlier ones, trader may not get the chance to even square up the short position. While I may be sounding little optimisitc but that has been happening for the past few days but market is not obliging.
As regards index options data, it shows total open interest of 94 Lacs Calls for 5200 strike price providing the indicator that Nifty Future will close above that level??? There has been increase of open interest (11.60 Lacs) in Puts of 5100 & 5200 strike price. This could mean that we may see a weak opening due to RBI Credit policy and once done with that we may see an up move. Just a wishful thinking and I hope it does turnout to be true.
Wishing you all a very Happy Diwali and A prosperpus New Year filled with lots of peace.
Ketan Asher.
PS: The next post will now be for 28th Oct.