NIFTY FIFTY
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Volatility which has been absent so far gives the indication that the players are fairly comfortable at these high levels.
However, these are also the levels where increasingly the players are likely to get nervous, and the market is likely to be tested for strength. Will fresh buying emerge on a bout of profit booking? Most likely yes, and it would be interesting to watch.
The bulls have been winning the last ten days on a roll, and surely here the bears would fancy their chances at these levels. Some correction after these several days of the climb would be the reasonable expectation. So yes, selling should be round the corner, and back again to the question above: Would there be buying support?
The other important factor is we are a week away from the F&O expiry next Thursday. This factor plus the expected bout of selling means that volatility would increase sharply from now on.
The Nifty is under no immediate threat of a deep correction, however one has to raise the caution levels and alertness in the face of increased volatility when it comes, and won't be long coming.
The levels, 2575 is what we must keep as long as possible. Above 2582 we are in some tough levels at 2595-2600.
To the down, 2550-2565 hold supports.
However, these are also the levels where increasingly the players are likely to get nervous, and the market is likely to be tested for strength. Will fresh buying emerge on a bout of profit booking? Most likely yes, and it would be interesting to watch.
The bulls have been winning the last ten days on a roll, and surely here the bears would fancy their chances at these levels. Some correction after these several days of the climb would be the reasonable expectation. So yes, selling should be round the corner, and back again to the question above: Would there be buying support?
The other important factor is we are a week away from the F&O expiry next Thursday. This factor plus the expected bout of selling means that volatility would increase sharply from now on.
The Nifty is under no immediate threat of a deep correction, however one has to raise the caution levels and alertness in the face of increased volatility when it comes, and won't be long coming.
The levels, 2575 is what we must keep as long as possible. Above 2582 we are in some tough levels at 2595-2600.
To the down, 2550-2565 hold supports.
The market is likely to be more whimsical than it usually is at these levels.
Yes there is buying support at every dip and yes the nervousness is palpable at every rise, as discussed yesterday.
The balance is even and so far so good.
The notion of balance itself is that, the finer the balance the greater its vulnerability.
This idea is akin to being on knife's edge. It takes a scanty tug to put balance into a vaporous mode.
The stablity and recovery yesterday came late in the day after a prolonged and choppy tussle...when buying emerged surprisingly even at the current high levels. How much lower should the Nifty dip for a bout of decisive profit booking, and how high should it rise before we shed our fears and jump into the act? Not clear yet, unfortunately.
And this may not be clear for as long as it takes for the balance discussed above to mature. Everything is uncertain still with perhaps an early indication that the recent highs may be tested again sometime soon.
And what then? Time will tell.
For now a choppy and volatile disposition continues to appear the most likely scenario.
Some short term supports are at 2598 and 2592, and we would do well to maintain 2592 as much as possible. Lower still are 2586 and 2575.
2620-2625-2630 are the upper levels to watch.
Yes there is buying support at every dip and yes the nervousness is palpable at every rise, as discussed yesterday.
The balance is even and so far so good.
The notion of balance itself is that, the finer the balance the greater its vulnerability.
This idea is akin to being on knife's edge. It takes a scanty tug to put balance into a vaporous mode.
The stablity and recovery yesterday came late in the day after a prolonged and choppy tussle...when buying emerged surprisingly even at the current high levels. How much lower should the Nifty dip for a bout of decisive profit booking, and how high should it rise before we shed our fears and jump into the act? Not clear yet, unfortunately.
And this may not be clear for as long as it takes for the balance discussed above to mature. Everything is uncertain still with perhaps an early indication that the recent highs may be tested again sometime soon.
And what then? Time will tell.
For now a choppy and volatile disposition continues to appear the most likely scenario.
Some short term supports are at 2598 and 2592, and we would do well to maintain 2592 as much as possible. Lower still are 2586 and 2575.
2620-2625-2630 are the upper levels to watch.
adilsaleem said:
2630 has been crossed , Amit could you please give us a update on nifty with what levels we should be looking at , any chance of a pull back ?
2630-2635 is for now the zone of resistance from what I can see.
2612-2598-2592 are supports.
On Friday, though closing higher than the previous day and having the highest weekly closing, the Nifty may be stuck with a couple of minor negativities for today, (minor being relative).
The first, today would be the thirteenth day going up on the trot, barring a very insignificant falter along the way on November 9, a loss of three points from the previous close. The very recent similar movement lasted about fifteen days before correcting mildly, only to get on with it. That was the lead up to 2663 where came the sharp slide which lasted about fifteen down days with a couple of feeble pullback attempts.
The second negativity on Friday was the inability to test and cross 2635. The double attempt to the up was topped out at 2632 followed by a slide to 2611, and the end came after a struggle at 2620, where over 2625 would have been much nicer.
The two points raised above may appear to be at odds with one another, though they are not:
As the Nifty appears to be heading higher to possibly test and break past the previous high, one would like to see it test lower levels sometime soon, and then bounce back in a show of resilience and strength.
One is speaking of a round or two of healthy profit booking as being correction and consolidation, which would allow more players to come in on the rally on its onwards journey. It is quite obvious, unless things take a sharp u-turn, that the liquidity which had vapourised recently is creeping back. There has been unambiguous buying support at every dip, and no dip has turned into a panic slide. The testing of, and finding support at lower levels would add to the confidence of a large number of players who are still nursing their wounds and fears. If the current pullback should be qualified as the resumption of the longer time rally, it can only do so in a secular and broad based manner. The memories should be raw still, of where a three-legged race really ends up.
And the above is related to the second point further above of the failed attempt at 2532 on Friday, in that we dont want to blithely test higher levels and react sharply there as seen then. On Friday a sense of edginess was clearly creeping in at the 2630 off levels where a prolonged tussle happened quite early in the session. Later in the day another feeble attempt or two caused the sharp reaction and the slide. 2635 is an important level to take and sustain but failing at these high levels will only harm the cause.
For this reason its important to go back a few notches and build up strength there.
The all time high weekly close mustnt be squandered.
The outlook remains positive as the Nifty is trading well above some crucial resistance levels and the momentum to the up seems firm. Choppiness and volatility would increase over the next few days approaching the F&O expiry. Should the trend and momentum continue to look good it may be a good idea to loosen some stop loss triggers cautiously on good momentum positions.
The levels, 2609 is an important number. 2601 and 2594 are crucial to protect 2584 the Fibanocci mark.
To the up, past 2625, 2633 has been unsuccessfully attempted and above this 2641 and 2649 are the range.
The first, today would be the thirteenth day going up on the trot, barring a very insignificant falter along the way on November 9, a loss of three points from the previous close. The very recent similar movement lasted about fifteen days before correcting mildly, only to get on with it. That was the lead up to 2663 where came the sharp slide which lasted about fifteen down days with a couple of feeble pullback attempts.
The second negativity on Friday was the inability to test and cross 2635. The double attempt to the up was topped out at 2632 followed by a slide to 2611, and the end came after a struggle at 2620, where over 2625 would have been much nicer.
The two points raised above may appear to be at odds with one another, though they are not:
As the Nifty appears to be heading higher to possibly test and break past the previous high, one would like to see it test lower levels sometime soon, and then bounce back in a show of resilience and strength.
One is speaking of a round or two of healthy profit booking as being correction and consolidation, which would allow more players to come in on the rally on its onwards journey. It is quite obvious, unless things take a sharp u-turn, that the liquidity which had vapourised recently is creeping back. There has been unambiguous buying support at every dip, and no dip has turned into a panic slide. The testing of, and finding support at lower levels would add to the confidence of a large number of players who are still nursing their wounds and fears. If the current pullback should be qualified as the resumption of the longer time rally, it can only do so in a secular and broad based manner. The memories should be raw still, of where a three-legged race really ends up.
And the above is related to the second point further above of the failed attempt at 2532 on Friday, in that we dont want to blithely test higher levels and react sharply there as seen then. On Friday a sense of edginess was clearly creeping in at the 2630 off levels where a prolonged tussle happened quite early in the session. Later in the day another feeble attempt or two caused the sharp reaction and the slide. 2635 is an important level to take and sustain but failing at these high levels will only harm the cause.
For this reason its important to go back a few notches and build up strength there.
The all time high weekly close mustnt be squandered.
The outlook remains positive as the Nifty is trading well above some crucial resistance levels and the momentum to the up seems firm. Choppiness and volatility would increase over the next few days approaching the F&O expiry. Should the trend and momentum continue to look good it may be a good idea to loosen some stop loss triggers cautiously on good momentum positions.
The levels, 2609 is an important number. 2601 and 2594 are crucial to protect 2584 the Fibanocci mark.
To the up, past 2625, 2633 has been unsuccessfully attempted and above this 2641 and 2649 are the range.
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