On the last day of the week the sell off across the market made the Nifty decline by 92 points to close at 5,512. During the intra-day session the Nifty did slipped below the September 2010 breakout, but managed to close above that level (5,500). On the technical charts we could see now first instance of lower low and a lower high in Nifty, which is a sign of worry. We could see further downside of may be 6-8% from current levels. The next level to watch out are 5,500 and 5,400. I recommend the traders to adopt a cautions approach, but these dips can definitely be used for fresh entries in blue chips for long term.
Right from the outset of the trading yesterday, the Nifty was struggling for a up-move. During later part of the day the indices witnessed a sharp fall and closed down 33 points at 5,691. The traded volumes were higher compared to the previous session, which is a negative indicator for a bearish session. As mentioned in earlier posts, the index trading just at the support, so the watch-out point from here would be the 200-day MA (5,600). So, if the Nifty breaches 5,600, we could see more downside.The global markets also in read before the India opens, does not provide a breather for us to recover.The trader should adopt cautious approach in the near short-term.
Nifty on the back of positive global cues and short covering gave the day positive start. The index managed to trader above the yesterday' s close through out the day and ended the day up 69 points at 5724.05. The index moving up on low volumes, suggest the up move to be a correcting move and traders using this an short covering opportunity. On the way up if the index manages to sustain above 5,720, it is likely to move up the ladder 90-100 points. However, the near term outlook remains bearish and the traders should adopt a wait and watch situation. The immediate support to watch for is 5,690.
The first day of the week turned out to be a mixed start with the frontline indices ending absolutely flat with a positive bias. Lot of news flowing the day, made the volatility persist through out the day. Concerned by market conditions, the year end is likely to be tough for the market. The immediate level to watch out for is the 200-day MA (5,606), if the Nifty closes below this level with higher volumes, that would definitely be a cause of worry. The investor should adopt cautious approach before creating fresh long positions.
Last two weeks have been the bad burner for the stock market. NIFTY has lost near to 500 points or 8% during the last two week to close at 5,655. The index on Friday, January 14 2011, closed below the crucial support level 5,690, suggest we should revisit our trading strategies in the near short-term. The rising food prices and the yesterday's INR2.5-2.80 approx. hike in petrol is a really icing on the cake. The trader should be cautious before creating fresh long positions. The NIFTY is likely to take support at 5,600 and if its broken next support will be 5,500.
