NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
And finally a sharp up move after many days. The first indication for the up move came in when Nifty Future made the day's low of 4633 - one point above yesterday's low. In the second session, Nifty Future maintained upward bias but the real spurt came in the last one hour of trading when Nifty Future made the day's high of 4768 and closed at 4755. The positive feature is that once again we have a long lower shadow after a double bottom and better still is the fact that we have closed above the previous quarter low of 4718. Secondly, as shown on the 30 min chart, last one hour's sharp up move has taken the Nifty Future above the channel formation. The negative point to be noted is that despite the sharp up move we did not manage to make a higher top (in NOV series) - although we did manage higher bottom - just by 1 point.
In today's trading, Dec 2011 series closed at 4777 after making a high of 4799. This does indicate that we should have a strong opening - helped a little by announcement for allowing FDI in Retail. One can consider going long with stop loss of 4720. Going long on gap open is best avoided. On the higher side, it will find resistance at 4875. Once again the Friday effect will also come to play as Weekly chart will look good only if we close any where above 4875.
As regards the Index Option chain, there has been considerable increase in open interest on the Call side for the strike price ranging from 4700 to 5100. As against this, there has been increase (10.06 Lacs) in open interest for the strike price of 4700. This does suggest, that there could be some correction before we continue the up move.
I would like to caution here that the fact that we have broken previous quarter's low of 4718 should be considered as a precursor to more down side. This up move should be considered just a relief rally, which could take Nifty Future to 5050 with hurdles on the way.
Please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.
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