Taking cues from global markets, as anticipated our markets posted one of the substantial gains yesterday, due to short squeeze, and bulls had upper hand, as FIIs numbers started looking positive since 24th. 5DSMA is held on Nifty, 20DSMA was not tested yesterday. Since our markets are almost aping the global markets, the negative news on home prices front which is down 11.07% lowest in the last 7 years, prompted US markets trade little choppy, finally closing in marginally negative territory. Asian markets have opened slightly negative, and Singapore Nifty futures point to 35 points negative opening for our markets too.
The rally of yesterday, can be termed as 'Dead Cat bounce' in technical parlance, and one should remember that we are in a bear phase, since indices are trading well below 200 DSMA, and also below February closing of Nifty 5223.50(it was the settlement price too); Today being the penultimate day of march series settlement, which is due tomorrow, choppiness can be very high today and tomorrow too, fresh long positions, on the assumption that markets have turned to bullishness will be another, gravestone mistake, usually, uninformed investors tend to make, repeatedly. Investors should exit profitable positions, on rallies, as the selling would come and continue once again, uninformed. The 20DSMA is currently placed at 4893.69(Nifty) & 16350.39(Sensex); would offer immediate resistance, for today.Staying liquid and increasing cash levels, always give ample opportunities a head, and one should not forget the golden principle "Cash is King" and I liked the statement of one analyst, recently, advising investors that 'Cash" is also an asset class, which is forgotten by many!
Range for the Day: Nifty might trade in a range of 4620 to 4920 today.
Strategy for the Day: Buy 4900 puts on rallies and 4600 calls on weakness in current series for intra day trading.
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