You must read previous articles and watch the given chart
carefully to understand this article completely.
For 10 June 2014: -
On 09 June 2014, FII Bought INR 536.68 crs and DII Sold INR 490.03
crs
We saw another life time high close on government’s reform
agenda. Market has welcomed those expected steps. Well, but it seems that poor monsoon
is going to be first battle field of this government. Progress of monsoon is
not going as expected. Government is planning for their action in undesirable
conditions regarding inflation.
Basic of technical analysis says that trend once established
is likely to continue than to reverse. This up trend is coming from 6638 levels
and stretched a lot. My expectation is that it can come near to 7700 also. Caution
is advised for sure at these levels especially mid cap and small cap stocks.
Many stocks of small cap and mid cap indices are rising dangerously. I still
believe that market cannot stretch far beyond 7700 without price correction.
Even if correction comes, this up trend will not break as it
has already generated a pattern which is not easy to break in normal case. My short
term view is that we may see correction towards 7400-7300 and then again budget
rally may start to give Nifty in the zone of 7900 to 8000 levels.
For today’s trading technical support will be at 7640 and
then at 7560 levels. Remember, a reversal point for this rally will be at 7560.
It should come in a day or two. First sign of this kind of profit taking will
be if small cap and mid cap indices shows relative weakness than Nifty. Rise will
face resistance at 7680 < 7700 < 7720 levels.
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Strategy for Nifty June
future – Nifty June
future may open near 7670 levels as suggested by SGX Nifty. Technical charts
are suggesting for support at 7630 levels after opening. I will not prefer buy
at top. Take a note that 7690 is level to watch on higher side. Yesterday, it
has failed twice. If it crosses 7690 then we can see further addition of 30-40
points in this rise. It will not be useful to short unless it breaks 7630.
S&P 500 (USA) – Most of conclusion remains same.
S&P closed just above 1950 levels. It does not matter even if we are at
life time high levels which are usually bullish sign. Technical charts are
saying for support at 1930 as of now. I am just waiting for some strong sign
for summer sell off which is bound to come. Below 1930 will be my first sign
for short. Short only if desired signal comes. What we need? Just one big red
day this looks sooner to come. Remember, fall can be more rapid than rise.
