TURNING POINTS FOR 01.02.2012

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD

NIFTY FUTURE:

In today's trading, Nifty Future opened firm, and after a steady rise through the day, made a new high of 5234 and closed at 5224 - near the high of the day. On the EOD chart, I have drawn a trend line which has provided resistance for the day. Considering the weakness in US markets, I do believe that today's up move was inspired more to show a strong close for the month and also to show a new high for the week.

For tomorrow, even if Nifty future opens strong, I would not advise long positions as there is channel resistance on weekly chart at 5270. Whereas on the Monthly chart, if it trades above 5235, it will be out of the channel. I don't think this could happen with US markets trading weak.

One can consider going short with stop loss of 5270. In case of weak opening, one can go short with stop loss of 5235. On the down side, it will find support at 5185 - 5150 - 5100. Fall will accelerate below 5150, as Nifty Future will be out of the Andrew's Pitchfork for the first time after trading inside it for a fairly long time.

As regards the Index Option chain data, the increase in open interest of Puts is much higher than the Calls.

Whatever may be your view, please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.

TURNING POINTS FOR 31.01.2012

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:

In today's trading, Nifty Future opened weak and gave a sharp correction - after 8 days of sustained up move. During the day, Nifty Future made a high of 5190 and low of 5101. It closed the day at 5112 - near the low of the day and hence weak. At the time of writing, US & European markets too are weak.

For tomorrow, we can expect a weak opening below 5100 - which will take Nifty Future out of the Andrew's Pitchfork for the first time after many days. On the downside, it will find support at 5060 and strong support at 4975. Furthermore, tomorrow's price action should be seen in context of it being the last day of the monthly candle and if the current up move is to sustain close too should be above 5100, as the upper shadow on the monthly candle will indicate the strength in the up move.

In case Nifty Future moves down to the low of 4975 it will find support of the trend line (shown on the EOD chart) as well as 0.382 correction level. At this level, one can consider buying Nifty Future for a bounce (or at least square up short positions - depending on your risk profile) with stop loss of 4950. On the way up, it will find resistance at 5100. As such, I would suggest to keep the bias negative while Nifty Future trades below 5100 and positive above it, as it could take Nifty Future up to 5165.

If you recall my weekly post, I had mentioned that we are in for an important week - well the beginning is just right - lets see how things unfold as we progress. In any case, don't forget to put the stop losses in place.

With Best Wishes,

Ketan Asher.

PS: Those using the quarterly levels (given elsewhere on this blog) should know that during the previous quarter Nifty Future made a high of 5403 and hence it is obvious that "All is well" happens only when Nifty Future crosses above 5403 - which as of today remains a bit far.

TURNING POINTS FOR 30.01.2012

NIFTY FUTURE 30 MIN / NIFTY FUTURE EOD
NIFTY FUTURE:

In Friday's trading, Nifty Future found resistance at the 200 DMA as mentioned in my post. The day's close has been near the high for the day and hence optimism remains positive, however weakness in DOW on Friday should remain a concern.

For tomorrow, fresh long positions are best avoided unless one wants to remain long in case Nifty Future goes up to 5270. For this, 5180 can be used as a traiing stop loss.

In case of weak opening (due to weakness in Dow), one can consider going short with stop loss of 5235. On the down side, it will find support at 5165 - 5130 and 5070. Fall will accelerate below 5070 as Nifty Future would be out of Andrew's Pitchfork after many days.

Please do not trade without STOP LOSS.

With Best Wishes,

Ketan Asher.