Daily_Nifty_VP's View-06/05/13

LEADER POST for Monday (06/05/13)

1.         Supports are at about 5917, 5897, 5978 and 5864 while resistances are at about 5960, 5977, 5993 and 6006. Previous lower level to watch is 5860. A +WW gives about 5983 (once above 5939) (+WWs with higher targets are not mentioned as of now). Three likely -WWs give about 5920, 5840 and 5835 (-WWs with lower targets are not mentioned presently). Two bullish flags can give higher level unless killed below 5700/5924.

Nifty reacted to close below important psychological level of 5950 thereby almost nullifying Thursday's gains. The daily candle is an Inside Bar and an imperfect bearish Harami while the weekly candle is an Advance Block Platter indicating exhaustion, at least temporarily, and some consolidation. However, monthly candle is still bullish. Also, nifty closed above an important Gann number of 5838 on weekly basis. Hence, if and when it validates this by crossing over previous high of 6020, it becomes a strong buy (for a possible target of 6900-7000). A close below 5850 will intensify selling. Bulls will hope that the improved micro-economic situation in India will take market further up. Only global cues and/or liquidity (including from DIIs) can take nifty further up. Volatility may remain high for a few days.

2.         PCR up at 1.12 and VIX down at 15.55. Pre-open data suggests a +ve nifty after a flat opening unless it remains below 5915 till afternoon.

3.         AS PER 9.30 STRATEGY, SELL ABOVE 5944NF, TARGET 5915, SL 5974.

4.         If SL is hit, buy below 5975NF, target 6005, SL 5945.

5.         SL hit.

6.         A new -ww gives 5938NS.

7.         -WW target met.

8.         SL of reverse trade also hit.

9.         SL hit again, for the third time.

10.       Nifty opened up with a slight gap, made a slightly lower low and then rose but could not make a higher high and fell again before finally rising to close +ve and also above yesterday's close. The target of first -ww of the first post was missed but that of the -ww identified during the day was met. The SL of 9.30 strategy trade was hit three times but neither side target was met. The daily candle is a combination of imperfect Low Price Harami and an imperfect Western Inside Session.

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