Nifty update for 14 March 2012

Nifty finally broke out of 5440 zone and ended at the day’s high. Though the break out was not big enough for a great journey one could at least take an intra day trade at these levels. One of the leading indicators of Nifty, ie; Jindal steel gave a 5% upmove in today’s trade and as of now it looks like the momentum is on the upside as we have already broken from 5440. In the coming days we need to see whether nifty could hold the support levels and move higher up to 5550-5560. As some bigger events are waiting on the side line I would like to take a long call on 5300 put and 5600 call with a total investment of 100 points (combined) so that I could take a positional view on nifty than going for a gamble. On the stocks front we have metal stocks on the buyer’s radar, but surprisingly bank nifty took a pause and that made the break out less effective. Thus in the coming days apart from the options trade take the trades only on intraday basis and cut the trades quickly. As I told earlier even if nifty goes up it would be an exit signal for me as the top is getting confirmed on the 20-21^st of March 2012. In a nut shell if u have long positions hold it as long as the support levels holds and take an exit above 5500 levels (futures) and we could think about other trades as the events unfold. In the commodities market as already mentioned copper and nickel are trading with an upside momentum with good support zones. One possibility for Nifty could rally on the upside is crude is taking a pause in its upside momentum and cooling off at higher levels. Volatility data shows a clear accumulation pattern on every dip as the volatility index closed on a negative note with an increase in cost of carry. Let’s keep a range of 5390-5550 and consider the upper end of the channel as an exit signal