Yesterday, I have written that the target of 4650 is achieved for nifty and one should be cautious from here on. Most of the analysts are looking at 4700 and 4735 levels for resistance, for this relief rally, as it was the March monthly closing, and when every one looks at a particular level, smart guys will exit much earlier to it. This is what exactly happened yesterday, while the going was good, FIIs started dumping stocks, in block, irrespective of individual performance, which brought the correction of indices to 5DSMA levels Nifty(4572.87) & Sensex (15390.97), erasing the gains of 17th entirely, the one consoling feature was, indices have made higher high and higher low yesterday. One more observation I wish to reveal is while Nifty has turned back from 4680 level itself, Sensex crossed March closing level of 15644.44 on 17th itself and moved a head to 15789.62 yesterday, which now corrected back to 15422.31 levels finally.
US markets have made new 3 month lows yesterday, due to disappointing results from Morgan Stanley and raising crude prices to 137$ from 132 levels, as supply concerns surface once again. US markets have the options settlement this week, and the volatility there is to be viewed partly as adjustment on that account also. Singapore Nifty futures are currently quoting at a discount of 53 points right now, and asian markets are trading in negative territory. VIX closed at 31.82 indicates continuation of higher volatility. Roll over of derivative contracts to next month series shall pick up from now on, which gives two way movement for the indices. Watch for support at previous week's closing levels on Nifty(4517.10) & Sensex(15189.62), in case of weakness at the opening or intraday today.
Range for the Day: Nifty might trade in the range of 4520 to 4650.
Strategy for the Day: Buy 4500 calls on weakness for quick returns in intra day trading.
Thursday, June 19, 2008
Nifty corrects as predicted and rests on 5DSMA support now!
Subscribe to:
Post Comments (Atom)
2 comments:
have been tracking this blog from quite some time...must say u get almost 95 % accuracy in ur predictions and above all ur opinions are really fair and unbaised .
keep up the good work ...
ps : btw i have nifty 4300 put ..anyy scope for it 2 work b4 expiry ???
Thank you for kind appreciation.
Generally, people tend to buy deep out of the money calls or puts, as they appear to be cheap, and loose money most of the times.
If you have followed the strategy recommeded to buy 4700 puts on rallies suggested recently on few occasions, it has given substantial returns.
Your 4300 puts of current month, in my opinion, might not give much returns, because the time value shall fall rapidly as we approach expiry, subject to market stabilizing above 4500.
I cannot comment because i am not aware of the price at which u entered!
If you wish to recover your money and make some profit too, then you should create a calender bear spread selling next month option of same strike price or lower strike price, where u need to maintain margin too.
bkvrkrao
Post a Comment