"After extreme volatility during the last week, the indices have closed positive on friday, and also week on week basis breaking 4 week successive negative closing. 5 being fabonacci number the closing gives hope that the correction might be over; the confirmation of which will be known during this week, which is quite crucial for determining the medium and long term trend of our markets.
The events poised for the week are many; Derivatives settlement on 30th; August monthly closing whether it would be, above June closing? Response of Congress Party/UPA to the concerns raised by Left parties on Indo-Us nuke deal; GDP data; over seas cues etc., The sad incident of twin bomb blasts in Hyderabad, on Saturday where 40 innocent civilians are killed and about 100 injured brought the focus on law and order situation, vulnerability of the civil life which naturally effect the sentiment of visitor (Tourists) and investors from abroad raising concerns on safety; Open interest postions outstanding more than 80000 crores are to be rolled over to the next series in the coming 4 days; nifty futures discount of 12 point for August and 29 points for September point to the negative bias in the markets. The small purchases made by funds around 200 DSMA are saving the markets from going into long term bear phase.
Undoubtedly, volatility will be at its best during this week, though we can expect positive openings and two way movement today and in the coming days, as shorts are to be rolled over to the next month series. In our view, it appears that nifty might settle around 4200 level on the settlement day; Buying 4100 calls on weakness in Nifty and 4300 puts on rallies can give good returns to the traders, who have the professional approach.
The day's range for Nifty shall be 4100(Support) and 4255 (Resistance); Sensex shall be 14080 (Support) and 14780 (Resistance)
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