Monday, April 9, 2012

EOD Analysis For 9th April 2012 and Outlook For 10th April 2012

OI in Nifty futures is still pretty low around 21 million or so; VIX marginally up above 22;

Critical levels and outlook remain unchanged for both Nifty and Banknifty;

As long as 5177 and 10150 hold on Nifty and Banknifty respectively on closing basis, the risk reward ratio is still skewed in favor of buying the dips IMHO That being said, 5348-5408 zone is stiff resistance as well on the upside!!! [trading levels and EW perspectives as usual covered by Raghuji and SMO so I won't dwell too much into that. This week we should be able to see consolidation within a range of 150 odd points with risk reward in favor of buying the dips.


I would again like to reiterate that the urge to build options straddles should be avoided this week as the premium burn rates will be high; odds are stacked in favor of option writers at the moment [I keep repeating this as a lot of us have the tendency to get lured by the temptation of quick rewards via options; in trending markets, options are ok but in range bound markets, they are money sucking instruments :D]

Next week will be very exciting in terms of large swings to play for in all likelihood as Nifty will likely pay homage to the 377 calendar day anniversary from the high of 5944 created on 6th April 2011; 

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