Daily_Nifty_VP's View-07/08/12

LEADER POST for Tuesday (07/08/12)

1.         The supports are closely grouped at 5280, 5273/71, 5260/58, 5253/50, 5230 and 5212/10. Resistances are at 5288, 5291/94, 5318 and 5333 while other level to watch is 5295 and 5358. An upper resistance is 5346. Two likely +WWs give about 5313 and 5320 while two likely -WWs give about 5144 and 5114 (once below 5222). The other -ww with lower level is not mentioned.

Nifty finally broke out of crucial level of 5250 to close above previous high of 5267 but closed in the resistance zone. So to begin with 5295 is one crucial level. The gap created on 12/07 (5306) is yet to be filled up. As of now, nifty doesn't seem to have enough steam to go to much higher levels unless we see a series of +ve actions from the Govt. Monday's brief speech by FM seems to have given some hope and it's possible that FIIs may see it +vely. So, we may see another upmove on Tuesday. But remember that strong resistances exist at 5346 and 5380.

2.         PCR at 1.08 and VIX at 16.22. Pre-open high/low 5323.10/5228.65 and close at 5295.40. The 10tf candle is a doji and may indicate flat trend with volatility.

3.         AS PER 9.30 STRATEGY, SELL ABOVE 5278NF TARGET 5261/45 SL 5308. BUT REMEMBER TODAY COULD BE VOLATILE IN A FLAT RANGE AND SLs ON EITHER SIDE COULD BE TRIGGERED AS IT HAPPENED JUST NOW WHEN IT TRIGGERED SL FOR LONG TREND JUST BEFORE 9.30. IF SL FOR THIS SHORT TRADE IS TRIGGERED AGAIN, BUY WITH SL 5293 AND TARGET 5341/61. I FEEL EITHER SIDE TARGETS MAY NOT BE ACHIEVED TODAY.

4.         Upper target revised down to 5356 from 5361NF.

‎5.         12th July gap filled up.

6.         A likely bullish flag fails below about 5308NF. First +ww target mentioned in the first post met. Second only a few points away.

7.         Second +ww target also met. Let's see if bullish flag mentioned above gives 5350NF.

8.         First target of 9.30 strategy reached. raise SL to 5323NF. Flag target met.

9.         A +ww target mentioned on 20/07 also met though increased since then.

10.       Nifty opened up with a small gap and, contrary to indication given by the pre-open candle, gradually climbed up to fill up the gap created on 12th July and finally closed +ve and also above Monday's close. It did not break any supports and went past all resistances to marginally break previous high of 5348 (and also the upper TL from Feb high) before reacting a bit. Apparently, buyers took +ve cue from FM's speech on Monday as stated in the first post.

In the process, both the targets of +WWs were met. Also met was the target of a +ww mentioned in the post for 20/07 though it had gone up since then. The SL of initial "sell" trade given by 9.30 strategy was triggered soon after 9.30 and both the targets of reverse "buy" trade were met. A bullish flag identified during the day also gave its target. In short, a satisfactory day for trading.

The intraday chart of nifty fut values with 5 min candles is shown below.