TURNING POINTS FOR 30.11.2010

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD

NIFTY FUTURE:

In today's trading, Nifty Future had a strong open and made the day's low of 5788 and there after maintained upward bias (with good support from Reliance) throughout the day and made a high of 5864. As the high of the day was made during the last 30 min, the close for the day has been reported as 5845.

On the EOD chart you will observe that Nifty Future remained just below the trend line. We can expect Nifty Future to gain further momentum only upon crossing the trend line above 5850 or better still after breaking today's high of 5864.

Those who have seen my noting on the DOW chart, I had mentioned that below 11000, it would break the inverted Flag on the down side. At the time of writing this post, it has gone down below 11000 on the back of European Debt Crisis. The inverted flag gives a target of about 10525. This point must be kept in mind while taking long position in our markets also as in light of weak closing in DOW today, we too may not gather the desired momentum to have a monthly close anywhere near 6000. Thus monthly candle for Nifty Future will be extremely bearish.

For tomorrow, one can hold existing long position with a strict stop loss of 5800. It will be better to create fresh long position only above 5865. One can even consider going short below 5800 with stop loss of 5835. On the down side we may see sharp decline to 5725 and 5675 levels. In this event, long positions should be avoided till Nifty Future takes support at 5550 levels.

Put Call Ratio of Index Options decreased to 0.99 as against 1.11 on the previous trading day.

Please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.

TURNING POINTS FOR 29.11.2010

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD

NIFTY FUTURE :

As expected Nifty Future had a sharp bounce on Friday after making a low of 5727, but closed at 5778, may be due to weekend considerations. As can be seen on the EOD chart, Nifty Future took support at 0.618 level as well as Andrew Pitchfork line and also completed the H & S target shown on 30 min chart during the past week.

Though Nifty Future looks weak on Weekly chart, a bounce can be expected more so with month end just 2 days away. Tomorrow, one can consider going long with a stop loss of 5700 to start with and it can be taken up to 5725 after an hour of trading. As you will observe on the EOD chart, once the trend line is broken when Nifty Future trades above 5760, it will gather momentum which can take it up to a strong resistance area of 6000 at least by Tuesday. It is therefore advisable not to remain short above 5760. On the way up it will face resistance at 5815 - 5865 - 5900 & 5940.

Put Call Ratio of Index Options marginally increased to 1.11 as against 1.05 on the previous trading day.

Please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.

TURNING POINTS FOR WEEKENDED 26.11.2010

NIFTY FUTURE WEEK ENDED 26.11.2010

NIFTY FUTURE:

Yesterday, we had a 3rd down week, which closed near the low of the week. While it may be too early to confirm the down move will lead to the formation of the Right Shoulder (shown in Green on the chart) which I have been indicating on the weekly chart for some time now, but I am sure the hard core bull will also now factor that as a distinct possibility.

The past week saw a big range of 300 points (high of 6027 and low of 5727) amidst high level of volatility particularly yesterday, when Nifty Future saw a sharp bounce of 100 points from a low of 5727, but by the end of the day it closed near the low of the week.

Another indication of the weakness in Nifty Future is that the weekly candle has closed below the Andrew's Pitchfork on the weekly chart. The hope for the bounce came from the 0.382 level and trend line support around 5725 level.

If Nifty Future breaks the level of 5725 next week, the next strong support level is 5500-5550. Considering a weak close, this possibility can not be ruled out.

We are now just 2 trading days away from the monthly close. Even assuming the best case scenario of closing nearer to 6000 levels, we will still not have a monthly candle that would suggest continuation of Bull Run in the immediate future.

In view of the persistent fall for the past 3 weeks, are we likely to really see the levels of 4400 for making of a Right Shoulder that I have been visualising? While it may have started as a fragment of my imagination, but the way the events have unfolded over the past one week, it does give an impression that it can turn out as a reality. All we need now is some event internationally which forces FII's to be consistent sellers - don't miss to see the possibility of inverted flag on the DOW EOD chart uploaded today. If Nifty Future remains below 5500 I would consider that probability to be much higher. This scenario get negated if once again we start trading above 6100. I am sure those following TP Grid will catch the turns without involving the risk of wrong judgement.

For those who are statistically oriented and are following TP Grid - at the close of last week, we had 24 scrips (out of Nifty Fifty) trading below the mid point of 52 Week Hi and Lo. As the market gets lower, this number will increase. So don't be complacent, add an unbiased statistical tool to your analysis that helps you to remain on the right side of the market - irrespective what experts have to tell you in the media.

Have a nice weekend and keep learning.

Ketan Asher.