Nifty - 30 Jun 2014 - Neutral mode continues

At end of month, Nifty continues to consolidate after a huge rally from 7240 to 7700.  

As discussed on Friday, the Nifty remained "Neutral at the start of the series" throughout the trading session. The Nifty opened with a positive gap up of 21 points at 7514 and made a high of 7539 within the first half an hour of trade only to consolidate and languish within a narrow band of trade for the next couple of hours. The Nifty did dip to 7482 briefly but recovered from there to close at 7509, which was below the opening mark but above the previous close. We did not participate on this range bound dull day of trade.

1) The Elder Ray readings : Bull Power reduces from +42 to +13 Bear Power rises from -43 to -47 indicating that the Bears are a bit stronger, but have to dislodge the Bulls as yet. For today, the Bulls need to overcome the levels of 7540 to maintain their upwards momentum whereas the Bears need to breach the levels of 7480 to maintain their downwards momentum.

2) The stochastics are now approaching the oversold zone, but are not there quite yet.

3) The Nifty has closed below its 8EMA and 13EMA but has closed above its 21EMA(7481) and also above all its key DMAs.

 

4) In the above chart, the volumes have decreased with the Nifty remaining stagnant, indicating indecision amongst the traders. The MACD continues to point downwards with the histogram too growing in the negative. The ADX is now suggesting a fall in the Bearish momentum but is still favoring the Bears. The Parabolic SAR continues with its Buy signal with the SL now at 7481.

5) Considering the above, our trading plan for the day is as under.

a) Around 7455, we will open fresh long positions with a SL of 7435 and a target of 7545. We will add to these long positions only above 7580.

b) Around 7560, we will open fresh short positions with a SL of 7580 and a target of 7470. We will add to these short positions only below 7435.

Happy Trading !!! 

Buy calls on RPGLIFE SSWL HITACHIHOM PTL & ASTRAMICRO hit their targets on 27 Jun 2014

Also visit Just Nifty and the Nifty Range blogs.


For cash market recommendations see our Daily Pre Market calls on NSE