Morning Update at 0800hrs for Intraday Market Level

[Class]

Hi Pranayk,
Do you think this was an Operator shake out today? I hadn't put stops in today, and if I had I think I would have been shaken out of half of my positions only to see them recover at the end of the day.

Obvioulsy, wish I'd put a stop in for Airtel, lost most of my profit in 1 day with little pick up toward end. Mital came out at end of day claiming to gain 100m customers in 3 years, so maybe tomorrow will give some relief.

Market dragged down by Bharti or effort by operators to shake out the smaller hands today?

All the best,

 

[pranayk]

Chart Analysis

 

[pranayk]

markets for 07 oct 09

the way market opened and then fell below mondays lows to breach the critical level of 4989 caught the bulls flat footed and nifty kept on sliding towards 4966 followed by 4949 finally to 4920 and threatened the bulls last citadel at 4904. But before the index could reach there, rear guard action by the bulls saw nifty rise step by step towards the earlier support at 4989 and after bulls managed to decisively cross 4989, there was no looking back for the bulls & massive short covering by the bears took nifty towards mondays trading highs of 4935.

Now the battle for supremacy between the bulls & bears will continue till the decisive cross over of mondays highs of 5051. If bulls are successful to keep nifty above 5051 then there is another possibility of a massive short covering to take nifty towards 5181 levels before the weak end. Bulls may require external support in the form of some solid announcement favoring the markets to accomplish this herculean task of trading above 5100 levels as deceptive dow which is more than 130 point up at present may suddenly change gear after closure of european markets. Even a 112 point rise in dow on monday night saw a operator driven fall in nifty till 4920 on tuesday. So bulls should not expect any help from dow any more although dow charts look extremely bullish to cross 10000 levels in october.

For intraday trading on wednesday, nifty has initial resistance around 5037 followed by 5051 above which nifty will move in lightening speed towards 5096 followed by 5111 to 5136 & 5166.however if bulls display tiredness in front of bears around the level of 5051 or 5096, then there is every possibility of nifty again falling towards 5000 levels to retest the earlier support of 4989.the massive volume during the second half of tuesday when the markets were rising suggests that the bulls have regained full control but no one can accurately say as to how the bulls will behave on wednesday morning after spending the martian night. The solid hammer formed on tuesday in the daily eod charts looks like hammering the bears out of shape.

 

[manzzu]

Dear Pranay,

Amazing Precision!! You simply rule Nifty. You are so confident about all the moves that reading your post is one of the finest thing a trader can do!!

Simply following your trading ideas can give amazing profits!!

So, be it the suggestion of Calls and Puts or buying specific stocks...you have rocked all the way!!

I take this opportunity to Thank you in millions!! May God Bless You!! :thumb:

Best Regards,
Manju

 

[chachi]

Dear Pranay,

Amazing precision. I love your writings. Its like reading some beautiful romantic novel. Your style is superb. Nifty behaves exactly as per your analysis.

And I often feel you are giving the running commentary of the market just in advance !!!

Hats off to you.

Regards
Chachi

 

[pranayk]

morning update at 8 am 07 oct 09

last night dow having made a high of 9774 corrected to close at 9731 still 131 points up and was the second day of more than 100 point gain beating mondays rise of 112 point gain. Brazil after many days of up moves went up by only .5%. European markets were highly bullish with more than 2.5% gain, uk ftse closed 2.2% gain & german dax closed 2.7% gain. Asian markets have opened in the +ve & may gain strength as the day progresses however japan & singapore may remain sluggish again.

For indian markets if operators do not interfere like yesterday then one can expect a solid gap up open above the resistance at 5052 levels. But since every one has turned bullish after the big pull back from the lows of 4920 to close at 5027, external operators may play their dirty game again to lower the markets to flush out weaker hands like they did yesterday. In this regard keep a close watch on operators infected low volume sgx nifty around the time of indian opening from 9.45 am onwards

technically the markets look extremely strong to move up towards 5200 levels in next few days once nifty crosses and closes above 5111, that is above the high of the doji formed on 1st october in the daily eod charts. However a decisive close below 5000 that is below the trigger candle next to the doji may take nifty down towards 4900 levels again. A solid hammer formed in the daily eod charts on 6th october indicate the possibility of upward move unless operators play their deceptive game of taking nifty down again after having closed at the highest point on tuesday. Not withstanding the game which the external operators play for their own benefit, markets look extremely bullish and every intraday fall like tuesday must be used by long & medium term investors as a god sent opportunity for going long after they find a more than 2 or 2.5% intraday fall as was seen on tuesday.

For intraday trading on wednesday, since the indicators slow stochastic & macd indicate good up move in the chart above, traders may go further long in case nifty sustains above 5051 levels. Stocks in the sectors of infrastructure, brokerages are highly over sold and may be bought on declines for good gains. Similarly stocks in sectors like metals oil & gas exploration may be accumulated for good gains. Keep an eye on ispat industry which is likely to blast off in a few days after a small decline from the sedate 23 levels. Option traders holding 5000 call may hold it & write (short) 5200 call on rise of nifty.

 

[gdaggarwal]

sir why u are so much bullish in ispat ind.

 

[pranayk]

The Nifty tested the support level of 4,910 and later recovered on the back of strong openings in European markets and firmness in Dow Jones futures. Telecom stocks tumbled on profitability concerns while buying in FMCG, metal and banking shares helped indices register decent gains by the end of the day.


However, despite a 120-point recovery in Nifty futures from the days low of 4,918, it is difficult to say that the worst is over. The trading volume in Nifty futures rose sharply due to profit-booking and possibly creation of short positions at higher levels.

The volume in 5,000-5,100 strikes calls and 4,900-5,000 puts rose sharply, mostly due to change of hands and short-covering. Traders booked profit and created short positions when the Nifty started trading above 5,000. The intra-day trading pattern suggests the Nifty may see fresh profit-booking above 5,050.

Nifty October futures continued to trade at a premium to the spot but shed 123,600 shares in open interest (OI) despite a trading volume of 38.46 million shares, indicating unwinding of long positions. The Bloomberg data suggested that traders booked profit at every level, which is why though the futures closed at 5,039, average trades changed hands at 4,980 levels.

Profit-booking happened across all call options, except 4,900-5,000 strikes calls. The 5,000 strike call options added 437,450 shares in OI, mostly through sell-side trades, indicating creation of short positions. The 5,000 put saw unwinding of short positions as OI in this put declined by 587,250 shares, mostly through buy-side trades.

Bloomberg data suggested traders were buying the 4,900 put on expectation that Nifty might face strong resistance at 5,000 and might even fall below 4,910. The change of hands was visible in the 4,700 put options as OI in this put rose only 99,800 shares despite an intra-day trading volume of 5.08 million shares

Source : Business Standard

 

[pranayk]

Chart Analysis

 

[pranayk]

markets for 08 oct 09

by now everybody must have realized the dirty game played by external operators to spoil indian markets. On wednesday they took nifty up by a gap up opening above the critical level of 5051, kept the index up above it for almost 1 hour inducing a feeling that there is a possibility of going towards 5100 levels but suddenly pulled it down through index heavies to take nifty down to 4975 levels to close it near the lowest point of the day at 4985 below te critical closing level of 5004.so on thursday one should be absolutely sure to see these dow operators taking the index down towards sub 4950 levels to breach 4920 or even 4900 levels to flush out weaker hands.

Long term investors must use this golden opportunity offered by dow & hedge fund operators to buy only on every decline. The action plan of operators every day is just do the opposite to the general consensus. So if every one thinks the index to be up or a particular stock to rise, be absolutely sure to see index or that particular stock to fall and it will only rise the next day or only after a few days or when every one has given up the hope. This is the trading pattern of hedge fund & dow operators spread across the world markets & have infected indian markets like deadly virus to which general investors & traders fall pray every day.

For intraday trading on thursday, one must expect the support around 4950 to be breached & next support around 4925 to be retested & if this is broken by operators, then be sure to see the make or break support around 4900 will also break to flush out weaker hands and markets to rise only after breaking the 4900 support for a few seconds. On the higher side if bulls manage to take nifty above 5005, then there is every possibility of further up move to retest the critical level of 5051 again.

With the external operators having infected the indian markets in a big way there is every possibility of a downward move towards 4925 first followed by a bounce. However if indian bulls muster enough strength to over power the external operators then there could be an initial bounce towards 5004 followed bu 5040 then to be handed over to the operators for their further action to bring it down like wednesday or surprise every one by taking nifty up above 5070 like tuesday which looks highly unlikely. Initially, after the breach of wednesdays lows of 4973, 4941 is a critical level for nifty as per chart above a breach of which may see lower levels on thursday. Even a good bonus issue by index heavy reliance may be manipulated by external operators to bring down the markets.