Trade Plan - November 1, 2010

Nifty continued its downward journey whole of morning session to below 34-DEMA levels and touched a new low of 5937 this week. Nifty futures took support at 5966 and rallied thereafter.  VWAP @ close is 6017 much below yesterday's November series closing VWAP of 6074. Nifty closes @ 6017 in the green. The rally after 2:30 p.m. can be interpreted as short covering of short positions built yesterday.

1) If this late Friday afternoon rally continues on Monday, then long only above today's high of 6032 on Monday for target of 6060-6100 on spot levels. A close above 6150 is very much important for further upsides.
2) The chart gives interpretation of this week's scenario and Nifty is clearly gravitating towards the long-term EMAs until and unless it does not close above 6150 levels on Monday/Tuesday and veers away from the 34-DEMA levels by a close at least 100 points above it to start with. The volatility is good and gives good trades just by following levels and booking profits intermittently.  Happy weekend!  Happy trading!

Trade Plan - October 29, 2010

A highly volatile expiry to the October series with a heavy fall from 6045 levels to touch a low of 5968 breaking the 34-DEMA levels.  Mid afternoon on break of 6060 levels it did look that Nifty would zoom up but could not cross above 6071 and tanked after 3 pm in one stroke from 6055 to 5968. VWAP @ close is 6032. Nifty closes @ 5987 levels and looks short-term bearish as the premiums in Nifty futures have dried up and gone into discount. Today's rally upside was mainly driven by short covering up to 6070. November series VWAP @ close is 6074.

1) Reversal point for Nifty remains 6060 levels with a close above 6135 for any strong up move.
2) Downside target below 5966 will be 5868 (55-DEMA) level from where reversal can be expected.
3) It is short on rise strategy for tomorrow with reversals above 6060 of spot value only.
4) Volatility is high and stop losses must be kept very tight.

Trade Plan - October 28, 2010

Nifty enters the last day of October series tomorrow on a negative note. Today Nifty has broken the 6060 barrier and the low made was 5987 levels very close to 34-DEMA levels. VWAP @ close is 6060. Nifty recovers from the lows to close @ 6013.

1) Tomorrow a short covering rally can be expected and October series might just close around 6060-6090 levels.  6000 CE premium trading above Rs.40 which is an indicator of a close around 6060-6090-6100 levels. Action in 6100 CE tomorrow intra day will also be interesting. Futures prices too are at a premium and trading at 6031 @ close.  Reversal point for upside tomorrow will be 6060 levels on spot prices once again.
2) If downside momentum continues and breaks the month low of 5966 tomorrow, then the downside target will be 5862 (55-DEMA) level.

Trade Plan - October 27, 2010

Nifty had a quiet range bound session today mainly in the negative zone, but well within the support levels of 6075-6120 and a good day for scalping for intra day. VWAP @ close is 6116. Nifty closes marginally down @ 6082.

1) October series could go any way now, either close above 6200 or around the strong support zone of 6000-5950 levels or may be trade range bound and close @ 6100-6125 levels itself.
2) Breakout levels remain same 6135 on spot for upside and 6060 on downside with the mean level being 6097 levels. Initiating longs above 6080 has proved to be good time and again in the past few days. Volatility has been low and a breakout looks imminent in the next two trading sessions of the October series.
3) Important levels now are 6040-6008-5979 on downside. On the upside levels, 6135-6150-6180-6200.

Trade Plan - October 26, 2010

A gap up opening at 6100 and touched a high of 6151 and failed to sustain above 6135 and retested 6100 opening levels for the rest of the session. Significant resistance at 6120 levels seen.  VWAP @ close is 6147. Nifty spot closes @ 6106 below  closing VWAP.

1) Views otherwise remains unchanged with 6135 (6162 in futures) being the spot value to go long for target of 6200-6240.
2) Now break of 6094 (below today's low) seems to be a good area to go short first for target of 6060 and  6020 intra day.
3) This week should see break of either 6150 for an upside target of 6250-6300 or break of 6060 for a downside target of 5970 (34-DEMA)-5900. There is quite a lot of selling pressure above 6135 as seen today. Today's close though in green does not conclusively give any indication of the way October series is going to close.

Trade Plan - October 25, 2010

Nifty did not cross 6135 today and broke down from 6105 spot levels to retest yesterday's breakout level of 6045 and closed at the 5-DEMA level of 6066.  The closing VWAP of 6104 reflects the inability to hold the levels of 6105+ today. Nifty managed to close above 6060 this week too.

1) Views remain unchanged for Monday with 6060 as strict stop loss for longs. The safest trading range in case of a high gap up opening on Monday above today's high of 6121 is to go long at 6135 spot prices with stop loss of 6100 intra day for targets of 6180-6220.
2) In case of a gap down opening below 6050 and downside breakout, the 34-DEMA level (now at 5964) will come into play again.
3) The weekly chart does not show any alarming break down, as Nifty has just consolidated in the lower band of 5966-6128 levels this week and should ideally go up and not down. Expiry week and high volatility also gives opportunity to trade intra day with 6200CE and 6100 PE respectively depending on the trend. The closing level of Monday will set the trend for November series. Happy weekend! Happy trading!

Trade Plan - October 22, 2010

Once Nifty spot crossed 6045 reversal levels after a quiet 2+ hours of trading, there was no looking back and the upside rally took place primarily driven by short covering and Nifty has gone to cross 6060-6075-6095 levels with ease and touched a high of 6113. Once again the level of 5966 proved to be a good support as seen earlier this month.  VWAP @ close is 6094. Nifty closes at 6101.5

1) Now Nifty again looks bullish with a close above 6100 and just above the VWAP levels. The first hurdle for tomorrow will be crossing spot levels of 6135 once again. Buy zone will be again 6080-6135 levels only for target of 6180-6250. Strict stop loss for longs will be 6060 levels on closing basis.

2) The chart shows the fibo levels of break out from a bullish point of view on closing basis that took place above this year's previous high of 5400 high from September and if Nifty can cross the previous Jan 2008 high of 6357 level on closing basis, then some more upside up to 6700+ levels is possible to this great rally of 2010 within the next few months. However, before that a close above 6220-6250 should happen first. Today's closing is a step closer to the bullish view. Bearish view will be "until and unless a close above 6357 does not happen, it is short on rise and buy on dips"!  Happy trading!

Trade Plan - October 21, 2010

Today's trading very similar to yesterday's and Nifty tanked after 3 pm to below 6000 levels to test 5966 levels and nearing the 34-DEMA levels of 5950-5900 which could provide some support. The level of 5965 was a strong support earlier last month. VWAP @ close is 6039. Nifty closes @ 5982.

1) Bias is negative and it is short on rise market now. Strict stop loss or reversal point for Nifty will be 6045 on spot levels tomorrow.
2) If Nifty takes support around the levels of 5940-5950, then a long could be initiated for target of 6045-6090. The chart shows the importance of 5940+ levels (38.2% fibo retracement level on closing basis) apart from being 34-DEMA level too.
3) Nifty will again become bullish only with a close above 6100 levels. The last few trading sessions of the October series will be volatile and range bound. Happy trading!

Trade Plan - October 20, 2010

An extremely volatile session today after trading consistently above 6080 in the morning session, but Nifty could not cross 6125 spot levels convincingly and later tanked to the lows of the day @ 6008 breaking the 6060 level once again.  VWAP @ close is 6100 and Nifty closes near the lows of the day @ 6027. For intra day it was a good day both for longs and shorts by following the trading levels.

1)Short term trend is down with a close below 6060 and the first target will be  below yesterday's low of 5985 or the 34-DEMA level of 5948.
2) Views otherwise remain unchanged, with intra day longs now only above 6060 levels and crossing 6135 levels decisively on spot prices or be short intra day for the above mentioned targets with a strict stop loss of 6055 (3-day SMA closing price) of spot prices.
3) Only a gap up opening above 6075 levels will help Nifty gather momentum or else trend is looking down for this week until Nifty takes U-turn after testing the 34-DEMA level.  Happy trading!

Trade Plan - October 19, 2010

After the euphoria of the first pre-market session starting today till 9:15 a.m., Nifty traded in negative territory and took support @5985 levels, stabilized at 6005 level and made an intra day dash towards 6080+ on spot after 2:30 pm. VWAP @ close is 6061, down from 6140 level of Friday close. Nifty closes at 6076 after triggering the level for going long @ 6080+ on spot prices.

1) If this momentum is maintained, then tomorrow Nifty should trade above 6080-6135 spot levels tomorrow for first half of tomorrow for targets of 6180-6220 level and go higher in the afternoon to close above 6250 for the newer highs.
2) 6030 (6055 in futures) level was the take off point today for the intra day rally today. Break of 6050 on spot tomorrow can again take Nifty towards today's closing 34-DEMA level of 5940.
3) The first day of the pre-market session was confusing a bit and over a period of time the trader will get better idea of interpreting the numbers that flashed on the screen during the first 8 minutes from 6120-6187 levels and finally settled at 6112 opening price @9:15 a.m.  and actually traded below 6050.
4) Levels to watch tomorrow, 5940 on downside and 6080+ for upside on spot levels.

Trade Plan - October 18, 2010

Nifty ended the week in the red at the crucial 6060 level after making a high of 6284 and with increased volatility Nifty enters the penultimate week of October series with a slightly negative bias. VWAP closes at 6140 for the week after touching a high of 6248 two days earlier.

1) Spot levels to watch intra day is 6085-6135 (6115-6162 level in futures)  for upside target of 6175 (Friday opening) and 6200 level (Friday High) for a close above 6250 level.
2) Break of 6050 (Friday low) should set Nifty for a target towards the 34-DEMA or 34-SMA levels of 5930/5900 levels.
3) The pre-market session of 15 minutes will be interesting and might give some idea of how the trade is going to pan out for the day. First important level is 6085 and the next important level is 6135 (above 5-DEMA levels). Volatility is going high and strict stop loss of 6075 for longs on spot levels (6100 in futures approx).
4) Nifty could stabilize around 34-DEMA/34-SMA levels of 5930-5900 after about 100 sessions of uptrend from the May 25th low of 4786. Happy trading!

Trade Plan - October 12, 2010

A gap up opening and throughout the day Nifty just ended up filling that gap trading in the range of 6110-6135 and never traded above 6135 (6164 in futures) level convincingly.   VWAP @ close is 6160.57. Nifty closes @ 6135.85. It was a good day for scalping between 6115-6135 today, both ways after the initial gap up levels cooled off and in the last 20 minutes Nifty did manage to cross 6135 today and may be fill up and retrace back to today's high (6187 of spot) tomorrow morning with a gap up and continue its upward momentum from thereon.

1) The level of 6135 remains the level for higher levels this week and 6135 (6165 in futures approx) will be a good entry point either tomorrow or day after once Nifty consolidates convincingly at this level. A close above 6200 is the next criteria for the uptrend to continue. Stop loss will be 6105 (below today's opening and low price of 6105.95).
2) Downside can be below 6125 level close for targets of 6090-6050-5990 levels. Stop loss for shorts will be 6155 level of spot (6185 approx in futures) on spot levels. Levels to watch tomorrow 6155 and above for upside breakout and 6125 and below for breakdown.
3) With weekend holidays for the Navratri festival, trading is likely to be sideways & dull this week between 6060-6200, and may be the breakouts and breakdowns are left for later this month before the October series expires and after this weekend.  Good time to take a break and have a re-look at trading the market afresh. The bias seems still up, however. I will be back with my trade plan only from next Monday (October 18, 2010) onwards.  Till then, Happy Navratri! Happy trading!

Trade Plan - October 11, 2010

Nifty largely traded with a negative bias and touched a low of 6079 mid-afternoon and took a U-turn to test 6115 levels. Significant resistance is seen around the levels of 6115 levels today and spot prices again fell to 6067 levels and recovered to 6115 level. VWAP @ close is 6131. Nifty closes the week @ 6103. The recovery from day's low to 6115 has been encouraging and good long trades for intra day players with the right kind of volatility.

1) On Monday, 6135 level assumes importance. If Nifty is able to cross and trade convincingly above 6135 levels on spot, then upward trend resumes with hurdles at crossing 6180 and 6200 levels with upside target of 6280-6330-6400.
2) If Nifty closes below 6060 on Monday, then a fall up to 5990-5920-5850 could be a strong possibility. As long as 6060 is not broken on spot, bias is up short-term. Today twice the level of 6060 has been protected well enough, indicating good support at lower levels. The impetus for upside has to come from the expected good Q2 results of the index heavy weights.
3) Two important levels to watch on Monday is break down below 6060 or breakout above 6135 spot prices. Of note, futures is still trading at high premium. Happy weekend! Happy trading!

Trade Plan - October 8, 2010

Nifty traded largely range bound between 6173-6190-6199 (6198-6224-6229 in futures) for whole of morning session and failed to break out above 6200 levels today ostensibly due to selling pressure at highs. Break of 5160 level @2:30 p.m. gave huge fall up to 6107 levels in no time.  VWAP @ close is 6184. Nifty closes in the red @ 6120.  The level of 6160 was a good reversal point today to initiate shorts intra day.

1) Tomorrow is the last day of this week's trade, and Nifty having conclusively broken 5-DEMA of 5134, it is a sell on rise up to 6145 with stop loss of 6160 on spot prices for target of 6075. 

2) Nifty could reverse from 6075 levels due to short covering and an opportunity to buy around these levels intra day can also be thought of with stop loss of 6060 on spot prices for a target of 6130-6160. The level of 6145 will be significant tomorrow if Nifty is able to sustain and close above it tomorrow.  There are some interesting scenarios to trade with tomorrow.
3) The Q2 result season will gain momentum from Monday onwards and this fall is likely a correction before the uptrend is likely to resume next week.  Happy trading!

Trade Plan - October 7, 2010

Another day of consolidation and Nifty traded in the range of 6223-6162 levels and never tested the opening recorded low of 6148. Good support at 6160 level in the past three days. VWAP @ close is 6216. The  intra day trades today was largely between 6168-6194 levels (6188-6225 in futures) after the gap up opening @6198-6223 levels .

1) Nifty needs to break and trade above 6200, but also close above 6250 level for higher targets and today's close @ 6186.45 above the support level of 6160 is the first indication of this scenario. The bullish range for tomorrow is 6195-6220-6250-6290 on spot prices.  Stop loss will be 6160 on spot prices.
2) First sell signal will get triggered only below 6160 and second signal below 6145 and it will be short on rise with a close below 6120. Stop loss for shorts will be 6180. The level of 6160 will be important over the next two days of trade this week.
3) The bias remains positive and a weekly close above 6250 will indicate all time highs in the coming weeks for Nifty.  Happy trading!

Trade Plan - October 6, 2010

A range bound day within the range of yesterday's low (6144) and well below yesterday's high on spot levels. 6155 was a good entry point twice for long trades intra day today. VWAP @ close is 6196.60 and marginally down from yesterday's VWAP of 6206.  Nifty has closed marginally down from yesterday's close @ 6145.80 around today's support level.

1) Views of levels remain largely unchanged from yesterday's plan as  the levels of 6160-6180 worked well today and Nifty is in consolidation phase with 6140 being a good support level.
2) For tomorrow, 6133 should be strict stop loss for longs and 6160-6170-6180 is a good level to initiate longs for target of 6220-6250-6275 on spot value, i.e., bullish range is 6160-6170-6190-6220-6250+
3) Break of 6133 on spot level could trigger an intra day dip to initiate short position on rise only with stop loss of 6165 for target of 6100-6070, i.e., bearish range is 6145-6135-6100-6075.
4)  Important point to be noted is today's opening spot level low on the trading screen @ 6118 was never tested and this level needs to be watched tomorrow as a turning point for downside if any. Overall, Nifty is very bullish as reflected by the unusually high premium in futures prices and it is certainly a buy on dips situation for intra day. If a weekly close above 6357 happens, then Nifty would have retraced the entire fall of 2008 and a new trading zone will get established over the coming months. The chart of Nifty for the period 2008-till date looks poised to conquer that level of 6357 sooner than later, but let the "trade be with what we see and not what we foresee". Of note the index laggards, RIL, RCom, Reliance Infra, Reliance Capital are all rising in tandem now.  As we all know, no breakout above previous high is possible without the Reliance pack.  Buying 6300CE or 6400 CE is also a good idea for intra day trade only.  Happy trading!

Trade Plan - October 5, 2010

Another new high made today at 6222 by Nifty and then a negative bias below 6205 spot to close @ 6159.  VWAP @ close is 6206. Nifty should consolidate between 6090-6180-6250 now for the next two trading sessions with a close above 6180 for positive bias to be maintained. The opening range breakout above 6194 on spot gave a good intra day long trade and then between 6180-6205.

1) Gap up opening means long only above 6180 with stop loss of 6155 for target of 6250-6280 on spot levels.
2) Gap down opening and break of 6128 on spot will be first sign of intra day weakness and break of 6100 will be the second sign of weakness and Nifty could test 6090-6050-6035 levels. Stop loss for shorts intra day only will be 6155.
3) Long above 6160 with stop loss of 6127 for target of 6190-6230-6250.  Alternately buying above 6060 with stop loss of 6030 if Nifty "falls to and reverses from" 6035-6050 levels tomorrow for a target of 6100-6130.
4) The premium in futures is quite high and buying on dips is a better strategy rather than going short and getting confirmed reversal from lower levels to initiate a profitable intra day long trade. The level of 6128 will be quite important tomorrow as close is below 6180 and way below VWAP level.  Happy trading!

Trade Plan - October 4, 2010

Today Nifty took off from 6060 levels and did not look back to register a high of 6153 on spot and closing VWAP is 6133. A great green opening for the October series for higher targets.  This move so far has been mainly propelled by banking index and steel and auto stocks. The big one Reliance is still trading range bound and if it breaks above 1020 to 1200 levels  then Nifty could touch 6500 levels.  Nifty spot has closed near the highs @ 6143.40

1) The trading range for next week starting October 4, 2010 shifts a gear up and bullish range will be 6100-6290-6400 levels for the week. For this scenario to play out Nifty needs to close above 6090 on closing basis over the next week and any dip up to 6080 would be a buy to sell on rise for intra day or using the opening range breakout plan on daily basis. The index holding above 6100 is the key hereafter.  The result season too begins this month and index will be highly volatile as results pour in with good results being rewarded with higher prices and bad ones will be taken for a beating. It is in this context RIL results assume great significance in this quarter.
2) The bearish range for this week will be below 6080-5880-5830 level. At the moment, things look evergreen for Nifty and market sentiment is now highly bullish with this Friday's trading session.
3) Another important factor to be kept in mind is the big Coal India IPO slated to open in the middle of October and both the above scenarios could play out over the month of October when institutional investors could book profits to invest in the Coal India IPO.  Happy weekend! Happy trading!