"Our markets were volatile a head of important FOMC meeting, and around noon, when European markets opened positive, and were trading firm, US futures turned positive, may be smelling the outcome, due to short squeeze our indices closed firm at the upper end of the trading range. Nifty closed firmly above july closing of 4529 for second time during this month, and with US markets rallying on FED cutting interest rate by 50 basis points to 4.75% and also further keeping the discount window at 50 basis points penalty was a clear surprise, and naturally Dow has posted one of its largest gain since 2002.
Nifty futures closed at a premium of 3.60 point in current series, with asian markets rejoicing the passage of an important event, which is equity market friendly, our markets will have gap up opening, and Sensex shall challenge the previous high today is certain. Now our markets shall concentrate on corporate performance, political risk, and expectations on interest scenario, as major banks are already voicing concerns on slowing of credit off take. Though the inflation is coming down regularly the Crude hovering around $81, the sensitive issue of increasing the prices of petroleum products, might come any time, which shall be a dampner for automobile sector and also manufacturing sector.
We feel that we are in for long phase of volatile times, may be for few months, which provide opportunity for traders, if they have right strategy. One can go long on 4500 calls of October series and 4650 puts and hold them for 15 days, for reaping in substantial returns.
The day's range for Nifty shall be 4530(Support) and 4646 (Resistance); Sensex shall be 15485 (Support) and 15950 (Resistance)
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