Nifty continues to drop down as Bears go on rampage. Key supports approaching.
As discussed yesterday, volatile times continued on the Nifty. The Nifty opened with a gap down of 17 points and immediately started selling off, albeit slowly in the morning hour, and then galloping downwards, breaching supports after supports, to make a low of 5749 before closing at 5761 with a whopping loss of 93 points. Our trading plan(b) triggered right in the morning, but hit the SL and we lost 13 points on that trade. Post that, we were out of the market attending prior commitments.
1) The Elder Ray readings : Bull Power reduces from -28 to -47 Bear Power rises from -81 to -137 indicating that the Bears have now got too strong a momentum, and may weaken a bit in days to come. For today, the Bulls need to overcome the levels of 5870 to regain their lost grounds, whereas the Bears need to breach the Nifty below 5725 to maintain their downwards momentum.
2) The Nifty has now closed below all its key EMAs, its 50DMA and its 100DMA. However, it is still above its 200DMA.
3) The stochastics are well and deep into the oversold zone.
4) In the above chart, the volumes have remained stagnant with the fall in the Nifty, indicating that selling pressure is about to peak out. The MACD continues to grow on the negative side. The ADX is suggesting a overall rise in the bearish momentum. The Parabolic SAR continues with its sell signal, with the SL now pegged at 5950.
5) Considering the above, our trading plan for the day is as under.
a) Around 5795 we will open fresh short positions with a SL of 5815 and a target of 5740. We will add to these short positions only below 5710.
b) Around 5725 we will open fresh long positions with a SL of 5710 and a target of 5785. We will add to these long positions only above 5815.
Happy Trading !!!
Also visit Just Nifty and the Nifty Range blogs.
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed yesterday, volatile times continued on the Nifty. The Nifty opened with a gap down of 17 points and immediately started selling off, albeit slowly in the morning hour, and then galloping downwards, breaching supports after supports, to make a low of 5749 before closing at 5761 with a whopping loss of 93 points. Our trading plan(b) triggered right in the morning, but hit the SL and we lost 13 points on that trade. Post that, we were out of the market attending prior commitments.
1) The Elder Ray readings : Bull Power reduces from -28 to -47 Bear Power rises from -81 to -137 indicating that the Bears have now got too strong a momentum, and may weaken a bit in days to come. For today, the Bulls need to overcome the levels of 5870 to regain their lost grounds, whereas the Bears need to breach the Nifty below 5725 to maintain their downwards momentum.
2) The Nifty has now closed below all its key EMAs, its 50DMA and its 100DMA. However, it is still above its 200DMA.
3) The stochastics are well and deep into the oversold zone.
4) In the above chart, the volumes have remained stagnant with the fall in the Nifty, indicating that selling pressure is about to peak out. The MACD continues to grow on the negative side. The ADX is suggesting a overall rise in the bearish momentum. The Parabolic SAR continues with its sell signal, with the SL now pegged at 5950.
5) Considering the above, our trading plan for the day is as under.
a) Around 5795 we will open fresh short positions with a SL of 5815 and a target of 5740. We will add to these short positions only below 5710.
b) Around 5725 we will open fresh long positions with a SL of 5710 and a target of 5785. We will add to these long positions only above 5815.
Happy Trading !!!
Also visit Just Nifty and the Nifty Range blogs.
For cash market recommendations see our Daily Pre Market calls on NSE
Nifty opened right into our suggested resistance zone, but we refrained from taking a hasty trade.
ReplyDeleteWaiting for the next opportunity with an open mind.
Bears not able to breach yesterday's low of 5749 as yet.
ReplyDeleteCould this be a point of reversal?
Trading plan(a) has got triggered now. Opened short position at 5795 with SL of 5815. Traded only one lot looking at event week, as well as week and month end tomorrow.
ReplyDeleteSL for short position triggered. But Nifty seems to be losing steam and is in overbought condition. Relaxing the SL by 10 points further.
ReplyDeleteSir, it is seems price moving up and trend has not yet turned complete down side.
ReplyDeleteOn the contrary, prices are getting into a very dangerous resistance band now.
DeleteBulls need to overcome yesterday's high in the next hour, then only a reversal will be confirmed.
It is not prudent for a trader to predict what will happen. Let the markets unfold.
Carrying over short position (one lot) for tomorrow, as the attempt by the Bulls seems to be a failed one as of now.
ReplyDelete