Nifty update for 03 November 2011

Nifty held the lower range of 5250 and bounce back to 5330 levels as people bought on dips. Though long build up could not be seen as compared to other range bound sessions retail investors are not ready to square off their long positions. As per the futures data we could see lot of profit booking is happening at higher levels and shorts are getting accumulated for the past few days and we could see an up move in market volatility.It is just holding on to 5250 levels and getting good support in this zone. IT stocks are cause some major worry at least in the short term as all of them have rallied so much and closed at day's low.All IT stocks are at major support zones and if they breach these levels we could see some correction for a short term. On a longer term view if the market is going to go up this sector would lead the rally.Indian markets looks like they don't care care about the global downturn and that gives a good amount of confidence to investors but it is not so good to test the support zone many times. As the volumes are getting lower there is no rush for buying nifty at 5250 levels this time.I prefer to buy an out of the money call near the support zones than adding futures.As long as the range of 5250-5470 it remains good for equity buyers. If it breaks on the downside i expect a minor correction to 5180-5200 levels.We are near to getting into one year cycle of bear market on Nov 5-8 2011 November it would have a significant impact on the trend of Nifty