After a spectacular rally on 25th, markets everywhere had sideways movement, and absence of short positions, gave breather to the indices, and investors in our markets, preferred to book profits, and close long positions, a head of derivatives settlement, and also anothe main consideration, for many, the adjustments to be made while closing the financial year 31.03.2008. Under T+2 settlement system, today is the last day for investors to book profits / losses for this financial year, as the pay out will be by 31.03.2008. The transactions done from tomorrow 28.03.2008, will be accounted for on 02.04.2008, in the next financial year. Huge volatility and fall of prices can be expected at the opening hours till the end of session today, in our view. US markets have opened in negative territory, and closed finally in negative territory on weak economic data. Crude (106$) and Gold (953$) are raising once again would not augur well for equities.
Nifty will open with gap down or trade in negative territory, due to profit booking or long roll over today. The mute question shall be what will be the spot closing price at the end of the session? February settlement price was 5285.10 and January was 5137.25, are distinct possibilities to be expected based on the current mood and scenario. While 20DSMA placed now at 4879.57 offers stiff resistance where as 5DSMA 4684.51 should offer support on weakness. Based on the put call ratio for the current series, roll over statastics, Nifty might close around 4725 today.
Range for the Day: Nifty might trde in the range of 4625 to 4925.
Strategy for the Day: Buy 4900 puts on rallies and 4600 calls on weakness for intra day trading for quick returns in current series.
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