TURNING POINTS FOR 17.11.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:

Contrary to my expectations, Nifty Future opened weak and continued its downward movement to make the day's low of 4998 and high of 5080. In volatile movement, Nifty Future closed near the high of the day, but due to averaging method of reporting - the close is at 5045. On the 30 min chart you will observe that the last candle has closed just at the median line of Andrew' Pitchfork. The positive for today's movement is the long lower shadow.

For tomorrow, one can consider going long above 5080, with stop loss of 5050. On the higher side, it will find resistance at 5125 - 5175 and 5200. Strength and conviction, will return only if Nifty Future trades above 5250. Though everything suddenly looks bleak as many of the stocks see a sharp down move and below the previous quarter's low, I would see a small possibility of up move due to FNO settlement scheduled next week. The stocks that look promising to take lead in this up move could be SBI (above 1820) and Reliance (above 905).

Weakness could accelerate below 5000 but considering my positive bias at least till we are done with the FNO settlement, I would not advise going short at lower levels.

Index Options data reveals interesting data as there has been unwinding of Puts in a big way. Whereas there has been considerable increase in Open Interest on the call side - totalling to 41.75 lacs for the strike price ranging from 4900 t0 5400 with maximum of 19 Lacs for the 5000 Strike price.

Considering the volatilty, it would be better to trade in options.

Please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.