TURNING POINTS FOR 11.08.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:

In today's trading, Nifty Future opened with a upside gap but capped further up move when it made 5223 as Open = High. For better part of the day, Nifty Future moved in a narrow range of 5150 and 5180. It finally closed the day at 5159.

At the time of writing this post, when US & Europe markets are down by about 3% what happened during our trading hours is history. If these markets continue to bleed till the time they close, we should once again see Nifty Future going down. For tomorrow, one can consider going short when Nifty Future trades below 5120 with a stop loss of 5170.

On the down side, it will find support at 5050. The fall will accelerate below 5050 and Nifty Future will retest yesterday's level of 4950. Below this, we have 4900-4920 as support area. Needless to mention that these support levels are good to square up your short positions and not to go long. The way things are, 4770 referred to in the last weekends' post, seems to be a distinct possibility.

I would also like to caution, that we have a long weekend ahead - with Holiday on Monday. I don't think much should be expected of Friday's trading as no trader would like to leave open trades in these volatile times. Please factor this information in your trading strategy from tomorrow itself.

Put Call Ratio of Index Options decreased to 1.19 as against 1.24 yesterday.

Please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.

TURNING POINTS FOR 10.08.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
As expected, Nifty Future opened with downside Gap and made the day's low of 4951 and never to come back again. Nifty Future sharply moved up to make the day's high of 5173 but came down sharply after European markets opened weak. A volatile day that finally closed at 5083.
For tomorrow, we can see the up move continuing which should be considered merely as a bounce and may be the worst is not yet over. Long positions may be taken with stop loss of 5075. On the higher side we have resistance at 5120 and 5165. Once this level is crossed we may see good momentum which could take the Nifty Future to 5250 and eventually to 5330 to fill the gap as shown on the EOD chart (must see).
As mentioned earlier, this up move should be considered only as a "dead cat bounce" after a fall of about 10% in 9 days. Moreover, there has been considerable addition (over 58 Lakhs) in the 4300 to 4500 Puts which should not be ignored. In the event Nifty Future goes up as indicated above, it would make a good contrarian trade to buy 4700 Puts which should be available at about 25, once Nifty Future trades above 5200. I am sure those who had the wisdom of buying 5000 puts must have gained substantially and they will do well to buy as stated above for a small portion of their profit. Who knows, with GOD willing, they may be in for a second bounty for the month. Please do not get carried away by the up move and stay light with long positions particularly with futures. Please remember that US down rating is not an event that can be wished away in a day or two, and if the AAA rating has such a significance than the implications should be far reaching in terms of time as well as the consequences.
Put Call ratio of Index Options increased to 1.24 as against 1.16 yesterday.
Please (read it twice) do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.
PS : Those readers who are interested in tracking FNO data during market hours, should visit www.nseinda.com and select Live markets and Equity Derivatives. I find the information quite interesting and to top it all - its free!

TURNING POINTS FOR 09.08.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD

NIFTY FUTURE :

As expected, Nifty Future opened with a downside gap and made a low of 5057 in the 1st hour of trade. In a surprise move, it went up to fill the morning gap and made a high of 5208. It could not sustain at higher levels after Europe markets opened and finally Nifty Future closed at 5126. The EOD candle is a doji, indicating indecision. Though the we had a volatile day, it wasn't as bad - may be because all were ready for much worse.

Our opening session will be influenced by how bad the US markets close today. At the time of writing this post the Companies which were backed by US Govt. too have been downgraded by S & P and this will definitely not go well with the markets and the slide may continue.

In such a scenario, we too can have a weak opening. Short position may be taken below 5120 with a stop loss of 5165. On the down side, it will find support at 5050, 5000 and 4920.

With addition of 24 Lakh Puts of 4700 strike price today, the worst may not yet be over.

Considering the way Nifty Future bounced back today, we must factor the possibility of Nifty Future showing strength above 5165 - atleast to fill the gap left on Friday's opening session i.e. near to 5335 level.

Put Call Ratio of Index Options was at 1.16 today.

Please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.