"Our indices amidst high volatility recorded new highs, on high momentum, inspite of flat to negative performance of asian peers yesterday and in the process Sensex created History by breaching 17000 intra day. Nifty found resistance at 4980 on several attempts and rollover caused last minute sell off, which made indices to close flat to marginally positive. Nifty futures are at hefty premium for Sept (18 points) and October series too have 8 points premium suggests that the rollover is smooth so far and shall be completed with positive bias.
US markets closed firm overnight and asian markets to follow suit, should augur well for our markets to open gap up and trade firm in the first session. Post sun outage trading, markets shall be volatile and Nifty shall have its turn to kiss 5000 in the process. The momentum being on its side crossing 5000 and closing above it on a settlement day may also need not be a surprise too, if it happens. One can look at technology sector on weakness in the market, as they will be coming out with the results in October. Further rally in the markets should be with the participation of Tech sector and other rate sensitives, as expectation of rate cut by RBI is too being factored in by market players, during the credit policy to be announced in October, or even before it, to help and sustain economic growth momentum.
Strategy for the Day: Buy 4900 calls on weakness and 5000 puts on rallies in September series and book quick profits, as it is the last day of the settlement.
Since the indices are in an unchartered territory, resistances cannot be predicted, only supports to be observed, whether held or breached to know and ride the trend which is up now on:
Short term support for Nifty shall be 4880-4760-4678-4648-4564-4530-4480 and for Sensex shall be 16715-16500-16135-15950-15870-15600-15485
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