Nifty gave a quick bounce after hitting the lower levels close to 5570. It is expected to give a range bound session between 5600-5650 before heading to 5300 levels. Before falling it broke from 5650 levels and lot of options built up could be seen at these levels. Though it gave a bounce we could see some major stocks like JSW steel, SBI and BHEL closed in the negative zone. In the hourly chart nifty broke the falling trend line for a bounce and it might extend upto to 5650 levels but there is no change in opinion as the advance/decline ratio is not convincing and we could not see any major accumulation pattern in stocks.If the bounce is here to extend i would like to go long in stocks like IDFC and Kotak bank above the previous as short term trades.From the telecom space R - Com too looks good in the chart. On the sell side there would be much bigger downside for stocks like JSW steel and SBI.We could not see any substantial increase in the premium and if there is long accumulation happening in nifty it would reflect in the premium and open interest. Volatility data is showing people are getting out of long trades at higher levels. Cyclically it is forming the same pattern that we have seen in 2010 ie; it formed a top between Nov 5-10 and in 2012 it formed the same pattern and i expect the same pattern to continue with 20-21 December and 4-5 th of Jan as major trend deciding days.
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