Tuesday, March 13, 2012

EOD Analysis For 13th March 2012 and Outlook For 14th March 2012

Positive start to the day aided by global cues and OI in Nifty futures was around 29 million in the morning itself; VIX cooled off below 25 as well and this is respite for bulls.

Critical Levels and outlook remain unchanged:

2 consecutive closes above 5408 and Nifty opens for 5532-5580-5608 on the upside
2 consecutive closes below 5325-5348 band and we are likely to see a retest of 5177-5196 band [and this should be considered as floor for another 12 odd sessions unless some extremely bad news crops up]

Current volumes are good to sustain upside upto 5440-5480 levels and we need at least 5% more volume to sustain another 100 points on the upside. For downside, these volumes are good enough for 150 points fall :D

BNF has managed to pull off the upside targets so far; 10800 will be a strong resistance which if taken out on closing basis will open BNF for another 350-400 points. It would be prudent to trade light until Friday considering volatility and some headwinds

Dow/SnP 500 seem to be in a topping process and one round of correction is expected in the next 2-3 sessions. IMHO the odds of this is very high as the Advance/Decline ratio has been negative and volumes traded also have been quite low in the last few sessions. All these point to negative divergence and potential profit-booking. Dollar Index is expected to start scaling up towards 81 and all of these high probable events  co-incide with our budget session.

[I agree with Raghuji that we should let the charts guide us] but in these turbulent sessions, only experienced and/or disciplined traders can do well. So will end this post with a simple mantra given by Raghuji 'To Each His Own' - HHHHHHHH

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