Daily_Nifty_VP's View-08/10/12

LEADER POST for Monday (08/10/12)

1.         The supports are at about 5739, 5714 and 5700. Resistances are at about 5751, 5759, 5831 and 5838. +WWs with higher targets are not mentioned as of now. Three likely -WWs give about 5728/5635/5521 (-WWs with much lower levels are not mentioned presently).

Nifty made a new high and then collapsed by about 15% on Friday before recovering, thereby confirming bearishness indicated by the formation of previous week's star candle and Wednesday's Doji Star. The daily and weekly candles are hanging man. Even if one ignores the freak trade on Friday, the weekly candle is a topping tail. The trend is hence bearish unless nifty closes above 5895.

2.         PCR at 1.06 and VIX at 16.78. Pre-open high/low at 6044.80/5746.95 and close at 5751.85. The 10tf candle is an inverted hammer and may indicate flat to -ve nifty after a flat open.

3.         AS PER 9.30 STRATEGY, SELL ABOVE 5758NF, TARGET 5721/12 SL 5788.

4.         Target of first -ww met soon upon open.

5.         First target met. I suggest book your short near target and go long with strict SL of 5710NF.

6.         Second target met.

7.         SL for long triggered but I feel it may not go down much more today. RIL playing spoil sport.

8.         Nifty opened flat and quickly started descending, closing -ve and also below Friday's low as indicated by pre-open data. The target of first -ww mentioned in the first post was met so were both targets of 9.30 strategy trade.

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