NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
After a weak opening, Nifty Future broke yesterday's low to make the day's low at 5221 and in the second session made a sharp up move to make the day's high of 5315 and closed firm at 5295. However the days candle remains a lower top / lower bottom (bearish signal) but with long lower shadow (bullish signal).
In today's trading, Nifty Future came so close to filling the gap but turned shy of filling the gap and completing one technical requirement. This brings to mind the idea that what if next time Nifty Future simply goes below without taking support at 5200 (see trend line on the EOD chart). It may sound prepostrous today, but if it can happen on the charts of Frances' CAC index and Germany's Dax and is just short of happening on DOW and S &P - why can't it happen on our Nifty? Just think about it as a remote possibility and if it happens be ready to take immediate corrective steps to your long positions.
Coming back to the tomorrow's market - we can expect to see a strong opening session (barring unforseen movemnet in US/European markets). Long position may be taken above 5310 with stop loss of 5275. On the higher side, it will find resistance at 5370 and 5400 where it will find resistance of the Andrew's Pitchfork median line shown on the 30 min chart. In case of weakness at 5400 level, one can consider buying puts of 5200 strike price or go short with stop loss of 5430. Short position may be taken below 5275 with stop loss of 5310. On the down side, it will find support at 5205 and thereafter, fall can accelerate as 'imagined' above.
As regards Index option data, there has been increase of open interest of 7.97 lacs in case of Calls for the strike price of 5300 & 5400. On the Put side, there has been increase of 14.95 Lacs for the strike price of 5000 - 5200. The origin for my that dreadful thinking starts from this data - why would someone buy so many puts if the market is not going to go down? Secondly, we have two holidays next week (Monday & Thursday) and hence in these volatile times people may not be so euphoric in the market on the last trading day of the week. To sum up, I feel it is unlikely Nifty Future will go above 5370. Once again I would repeat that please refer to this data on the nse website duuring market hours, as it guides you to many trading opportunities.
Whatever may be your view, please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.
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