Though our markets have opened with some gains in the beginning of the trade yesterday, the profit booking in the later half has created new lows for 2008, on our indices, finally closed with losses. Nifty too has completed 40% fall from the top of 2008, breaching 3814.26, intraday. The profit booking by bears in index futures lifted the nifty to 3842 levels at the end of the trade, though on adjustment Nifty closed at 3816.70. The closure of Nifty above 3800 especially, above 3814.26 was encouraging, with crude cooling further to US 134$, and a big rally overnight, in US markets will have rub off effect on our markets too initially, and we will have a gap up opening today. VIX closed at 31.10 yesterday, though intraday high was 54.88. Volatility has become part of our markets, as the domestic issues too are influencing our markets. TCS & HDFC results were in line with market expectations. Trust vote number game is oscillating with no clear direction in sight, while 22nd is approaching. Inflation numbers to be announced tomorrow are expected to clear 12% for certain. Thus, intraday trading and booking quick profits is only recommended till real strength is visible. Staying in cash is the best strategy, in these troubled times, until confirmation of bottoming of markets appear.
Singapore NIfty futures are currently quoting 150 points premium, and asian markets are trading with gains, which gives good gap up opening for our markets, where investors need to watch the resistance at 3985.74(Nifty) 5DSMA level initially and then 4040 (June closing levels) where profit booking or fresh creation of shorts can be expected. Investors better advised to exit weak long positions on such rallies, and increase cash levels.
Range for the Day: Nifty might trade in the range of 3850 to 4050.
Strategy for the Day: Buy 4000 puts on rallies today for intraday gains.
2 comments:
Dear Sir,
i have few questions
if the govt survives trust vote do u think market will go up? upto what level?
In case it fails what level nifty may go?
what do u think this expiry level will be?
Saba
Dear Saba,
Long term trend is down thus, survival of trust vote gives relief rally in bear market which can take nifty past 4300.
Failure can bring the nifty to 3500 level, in my view.
Settlement is far away..another 11 trading days, before which number of events will unfold like RBI policy on 29th etc.,
One thing is certain that volatility will be high through out the series.
bkvrkrao
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