You must read previous articles and watch the given chart
carefully to understand this article completely.
For 12 August 2014: -
On 11 August 2014, FII Sold INR 162.92 crs and DII Bought INR
234.41 crs
We got gap down on one day and next day we got gap up. These are
just cannot easy to conclude as gap are wild thing. There is just one strong
point that we have – gaps are usually a symbol of primary trend in the same
direction. So one day it was down and next day it was up. Now, I am focusing on
follow up of trades. As long as it is above 7609 I can say that it is near to
the strong support area.
Now 50 DMA is at 7616 and 20 DMA is 7680. Best, trading
direction on Nifty always comes when it stand above both these moving average. Trades
in between 50 DMA and 20 DMA is not easier. Although I believe that it can see
a move towards 20 DMA. We need to take a note that this bounce has just started
from 50 DMA support so it is still early stage. If this bounce is going to
sustain then we may see the conversion of another rally. One should never short
index in this kind of formation.
Yesterday, we saw the meaning on hammer pattern. Yesterday’s
low was also higher than Friday’s high. Another important point is that we saw
a good short covering move in last 30 minutes of trade.
For today’s session, I am expecting some higher opening. It will
not be easy if it comes directly at 7680. Depending on gap up one should to
trade long in intraday dip as long as it is saving 7616 levels. It is not going
to be as simple as I am writing. Range to watch will be 7615 to 7680 for any
direction. It is favouring up and bullish move as of now.
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Strategy for Nifty August
future – Nifty August
Future may open positive 35-40 points as indicated by SGX Nifty. So will it be
second gap up the row? If this happens then do not act in opening hour. It can
be only meaningful if you buy a dip rather than these ride. My expected target
can be at 7700 or higher but buy point must be reasonable.
S&P 500 (USA) – S&P came tall with a bounce
from 1910 to 1945 levels. After hitting 1945 it slipped in second half. 1945 is
also a point where earlier it made a life time high and corrected. So, it is a
meaningful resistance. Has it formed any fresh sign of weakness? As long as we
are getting positive close we cannot say any weakness yet. From 1945 to 1935 is
just a typical dip which may be bought by market.
