02, JUNE
Nifty 2962.25
Though the level 3050 was also breached, the trading pattern for the past few trading sessions suggests that the Nifty is in the last leg of this correction. Now the possible range for the last leg to get completed is quite wide. In some cases, if the market is strong, it will not go below its previous low and here it is 2896. In some cases, a new low will be formed within few points below the previous low. In this case, Nifty could form a bottom around 2850. In some cases, the low is formed at double the length of the previous rally. Here the previous rally moved up 380 points and another 380 points fall below the low of 2896 is the maximum possible correction.
With almost all the individual stocks already retraced by 33 percent, a drastic extended downside fall in Nifty seems unlikely. Chances for Nifty to bounce back within 70 points from here is more likely. Todays trading pattern can give a clue about the position of Nifty. In any case, the swing in the nifty is going to be wide. Protect your position with stoploss or hedge using options.
On the upside, a move above 3130 region would give strength to the market.
Friday, June 02, 2006
Thursday, June 01, 2006
TECHNICAL OUTLOOK - 01, JUNE
01, JUNE
Nifty 3214.90
Last week, I mentioned that 3050 region is the tip of the triangle. Markets normally bottom out around this region, if market is correcting that particular last leg. Here, the last leg started around this region. Though Nifty moved below this level in the intraday, it has not so far closed below this level. So, the chances of market bouncing from this level is very high. If Market bounces from this level and clears 3280 region in three trading sessions, then the bottom formed at 2896 would not be violated here after.
For todays trading, Nifty could once again retest 3000 levels before moving up or it would sharply move towards 3140 region. In any case, a move above 3110 level would indicate strength. After testing 3280 level, Nifty moved down to test 2970 level in four trading sessions. So, Nifty should move above 3280 region in less than four trading sessions to move up further.
On the other hand, if the region 2970 is violated in the downside, Nifty would move towards its previous low of 2896 region sharply. Even this level 2896 is not held, then the correction could extend further drastically.
It Seems Nifty has bottomed out and has turned bullish. Initially, it could move towards 3280 level and if this region is cleared, then it could move towards its previous top of 3777 in coming weeks.
Nifty 3214.90
Last week, I mentioned that 3050 region is the tip of the triangle. Markets normally bottom out around this region, if market is correcting that particular last leg. Here, the last leg started around this region. Though Nifty moved below this level in the intraday, it has not so far closed below this level. So, the chances of market bouncing from this level is very high. If Market bounces from this level and clears 3280 region in three trading sessions, then the bottom formed at 2896 would not be violated here after.
For todays trading, Nifty could once again retest 3000 levels before moving up or it would sharply move towards 3140 region. In any case, a move above 3110 level would indicate strength. After testing 3280 level, Nifty moved down to test 2970 level in four trading sessions. So, Nifty should move above 3280 region in less than four trading sessions to move up further.
On the other hand, if the region 2970 is violated in the downside, Nifty would move towards its previous low of 2896 region sharply. Even this level 2896 is not held, then the correction could extend further drastically.
It Seems Nifty has bottomed out and has turned bullish. Initially, it could move towards 3280 level and if this region is cleared, then it could move towards its previous top of 3777 in coming weeks.
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