TURNING POINTS FOR 05.09.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
On the last Friday's trading Nifty Future ended the day with a doji on the EOD chart. On the 30 min chart you will observe that trend line (in magenta) has provided resistance. In hindsight we can say that Nifty Futurre had foreseen the fall of over 2% in US & European markets.
In view of the weakness in overseas markets, in all likelyhood we should have a weak opening.
Short positions may be considered with a stop loss of 5055/5075 depending on the way market opens. On the down side it will have support at 5000 - 4920 and strong support at 4865-4885 level. If Nifty Future stabilises at this level, one can consider buying (for a bounce up to 4920) with a strict stop loss of 4850. Weakness below 4850 can take Nifty Future down to test the previous low of 4700.
It is important that you read (and also see the charts) the Monthly & Weekly post which was updated yesterday.
Please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.

TURNING POINTS FOR WEEKENDED 02.09.2011

NIFTY FUTURE WEEKLY

After a sustained fall for the past 5 weeks, we had a strong up move - in a truncated week. The week saw a range of 270 points (High 5072 & Low 4802) and saw a firm close at 5034.

On the attached weekly chart, I have drawn Andrew's Pitchfork which indicates strong support at 4600 level alongwith a trend line (in magenta).

I have also marked a period of 42 weeks starting from High of 6336 and low of 2228 in 2008. The entire fall amounted to 4108 points. Interestingly, this time around we have a low of 4718 (indicating fall of just 1631 points) in the 41st week from the high of 8349 in the last Diwali week. The point I would like to highlight is that in almost the same time,the fall has been less than 50% than the last time. I would read this as a positive feature and consider buying at lower levels i.e. around 4700 +or- 100 points and change my view to further bearishness only below 4600 as shown on the chart. For the market to fall below this level will need some major reasons. I for one am quite content with the events that have emerged over the past one year - which incidentally happened to be 64th year of our independence! I just wonder what more is left to emerge for the market to break the level of 4600.

In nutshell, I would suggest :

a) Not to remain too bearish at lower levels viz. 4700 +or- 100 poitns.

b) Consider buying blue chips at every fall up to 4600 with a plan to invest and not just trade for a few points.

Do pray Lord Ganesha over the weekend that the above view turns out to be true!

!!Ganpati Bappa Morya!!

Keep Learning,

Ketan Asher.

TURNING POINTS FOR 02.09.2011

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:
!!Ganpati Bappa Morya!!
Last Tuesday's trading remained volatile with Nifty Future making the day's low at 4924 but ended the day strong with a close of 5003 after making the day's high of 5022. Tuesday's price movement remianed above the trend line shown on the EOD chart. Though this augurs well for the market, but I would not call this as final bottom as we have neither made higher bottom nor made a double bottom (on EOD chart) to confirm that the worst is over. Simply put, caution remains the watch word even if we go up to 5200.
For tomorrow one can consider going long with stop loss of 4920. On the higher side, Nifty Future will find resistance at 5050 and 5100. I doubt if Nifty Future can cross the resistance level of 5075-5100 in the first attempt. One can consider going short at higher level with stop loss of about 50 points. On the down side, break of 5920 will lead to weakness which can take market to 4865 and below that it can test the previous low.
Put Call Ratio of Index Options decreased to 1.03 as against 1.10 on the previous trading day,
Please do not trade without STOP LOSS.
With Best Wishes,
Ketan Asher.