It hit our upper band of 5400-5410 and closed below today's high. We could see some options writing activity happening in 5500 and 5600 options and some profit booking in nifty futures. The volatility index closed the session on a negative note and thus we could see some profit booking happening instead of short build up.
As the trading days are less options writers would make use of the extra premium in this range bound session. We could see some serious profit booking happening in stocks too , especially the banking sector stocks. On the way ahead 5400-5410 would be a crucial level for nifty futures and we should see some increase in the premium with a negative volatility data for some positive move in the market. As predicted in the end of February we had a decent rally in the first week of the April series and the rest of the move could be treated as extensions of this rally.On the downside 5330-5320 would be the important support zone to watch out for.If it is a break out on the upside we are getting close to the important resistance zone and as a safer bet as i said in yesterday's post i would like to take off some profits and wait for a better opportunity to get in. As a short term investor we should wait for better opportunities to get in than to participate in a trade in the upper range. If we take the larger picture it is still in a bigger range bound market within 5200 - 5500 range but in a strong base building process for a smarter bull run.Thus the major advantage of this base building process would be some of the major stocks would get enough time for a strong foundation to build up. We have been talking about lot many stocks over the past few days including yes bank, axis bank , tata steel and reliance (as a short term investment) and all have given decent returns within a shorter time period.As an investor it would be a game for a slightly longer horizon and lets wait for another dips for any fresh accumulation.Lets keep the range pf 5290 - 5410.
As the trading days are less options writers would make use of the extra premium in this range bound session. We could see some serious profit booking happening in stocks too , especially the banking sector stocks. On the way ahead 5400-5410 would be a crucial level for nifty futures and we should see some increase in the premium with a negative volatility data for some positive move in the market. As predicted in the end of February we had a decent rally in the first week of the April series and the rest of the move could be treated as extensions of this rally.On the downside 5330-5320 would be the important support zone to watch out for.If it is a break out on the upside we are getting close to the important resistance zone and as a safer bet as i said in yesterday's post i would like to take off some profits and wait for a better opportunity to get in. As a short term investor we should wait for better opportunities to get in than to participate in a trade in the upper range. If we take the larger picture it is still in a bigger range bound market within 5200 - 5500 range but in a strong base building process for a smarter bull run.Thus the major advantage of this base building process would be some of the major stocks would get enough time for a strong foundation to build up. We have been talking about lot many stocks over the past few days including yes bank, axis bank , tata steel and reliance (as a short term investment) and all have given decent returns within a shorter time period.As an investor it would be a game for a slightly longer horizon and lets wait for another dips for any fresh accumulation.Lets keep the range pf 5290 - 5410.
