Wednesday, November 16, 2011

EOD Analysis for 16th November 2011 and Outlook for 17th November 2011

Negative global cues on open itself and a big blow to Asian markets today with Euro-Dollar going well below 1.35 levels in the morning and it was a definite blood bath across sectors. Twice in the day we breached the 5k levels but the 4994 levels seemed to provide the relief that was needed for now at least. Euro-Dollar has regained the 1.35 mark for now and European bourses also saw some good short-covering as I put this blog out. As indicated earlier, Nifty would get softer as we move towards 16th November and 16th November to 22nd November are extremely volatile days.

The OI in Nifty futures was hovering around the 33 million mark today and the VIX surprisingly is still hovering around the 26 mark. For accelerated falls, the VIX needs to be above 28-29-30 mark [one should remember that in August and September when Nifty was at sub 4800 levels, VIX was in the region 32-33.5]
BNF saw a short build-up but some good short-covering later.

DAX is trading firm above 5900 again and FTSE is also above the 5500 mark as I put up this blog. Weakness in Europe to be confirmed with FTSE below 5400 [looking for 5300 in a few sessions] and DAX below 5700 [looking for 5600 on DAX in a few sessions]. From US, first sign of weakness below 11800 on Dow and full weakness below 11500 [correspending levels on SnP 500 will be 1230 and 1190 respectively IMHO]

For Nifty, unless bulls manage 2 consecutive closes above 5092-5125 levels with huge volumes, bears can launch an attack again. On the other hand, despite 2 steep falls, 5032 levels survived another day. [adjusted close shows 5030!]

Critical levels remain unchanged.

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