NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
Last two hours of trading on Friday, saw a sharp sell off - particularly after the credit policy which was well received after it was announced. The fall took Nifty Future down to the day's low of 4625 (previous low 4632) and took support on the median line of Andrew's Pitchfork on the 30 min chart. Post RBI announcement, it made the day's high of 4940 which has been a major resistance area for sometime now.
On the attached 30 min chart, you will observe that the low is on the Median Line (in Blue) and more importantly the Friday's low is also a 2.618 times the previous range. These two reasons suggest to me that there could be a turnaround from this levels as we have also managed to do double bottom. However, I must add a cautious note that this will hold good till the Friday's low of 4625 or 4600 is not broken.
For tomorrow, I would recommend going long with stop loss of 4600. Those who wish to be cautious can wait to see if Nifty Future manages to trade above 4668 (2010 Low) before taking long positions. On the higher side it will find resistance at 4730 and 4780.
As regards the Index Option chain data, after the sharp fall, there has been increase in open interest of 31.39 Lacs for the strike price of 4600 & 4700 Calls. As against this, the increase in open interest on the put side has been much lower. To me, this too suggests a good opening for tomorrow.
As the markets remain volatile, it is prudent to trade in option and that too with strict STOP LOSS levels.
With Best Wishes,
Ketan Asher.
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