Wednesday, May 30, 2012

EOD Analysis For 30th May 2012 and Outlook For 31st May 2012

OI in Nifty futures moving towards the 30 million mark and we are a day away from May series expiry

Critical levels and outlook remain unchanged for both Nifty and BankNifty

Updating charts until yesterday EOD


Following up on Jacs' comment on the EW section last night, from the lows of Dec'11, we did 4531 to 4740 odd levels, fell to 4640 before starting the impressive rally - so even with the bullish stance, a fall to 4800-4840 levels cannot be ruled out before the potential impending rally [difficult to start before 20th June 2012 IMHO] Any rally upto 5944 will only be a relief rally nevertheless that one must always bear in mind

Other Updates

Regarding Rollar, the rise beyond 54.5-55 has definitely stumped many including me but we must realize that it has more to do with Dollar Index than Rupee by itself and the negativity surrounding Rupee is being overdone in the media IMHO. Soon, we should be able to see some stability in the Rollar and a move below 52 in the next 6 to 8 weeks is likely [though the rise above 56 makes a test of 57 levels highly likely] and we may end this year well below the 48 mark [current situation is good for NRIs to convert their forex into rupees and park a good chunk {at least 30%} of it in FDs and Debt Schemes]

Too much is being spoken about the correction in Tata Motors as well but one needs to see the price action and as long as it stays above 220 levels, it is close to the previous all time highs [extrapolating for the stock split] Whilst the slowdown in India is currently being compensated for by the sales in JLR, by the end of this year, it should be the other way around.

Gold: We are yet to see a reasonable impact on Gold prices in India due to the Rollar effect. In USD terms, a bottom is expected to form in Gold around the USD 1350-1450 per ounce, in Rupee terms, seems unlikely to go below INR 23k for this year as of now. As prices march towards 25k mark, one may look to start accumulating again via Gold ETFs [the falls in dollar terms can be faster once prices close below the USD 1500 mark per ounce]

Last but not the least, trading on Futures and Options have been extensively covered in a separate blog section called Futures and Options Paradox and I won't be repeating the same on a regular basis on this blog :D

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