Monday, March 3, 2014

Outlook For March 2014

Well February was quite exciting towards the end of the series. Overall, the range for Nifty remains unchanged at 5950-6350 until election results go through. Any major upside or downside from these levels will be subject to events not known [and hence called Black Swan Events]

The charts are pretty straightforward and I have marked my comments

Nifty Daily

Nifty Weekly

BankNifty Daily

BankNifty Weekly
Right now, Nifty is bullish on Daily, Weekly and Monthly time-frams

Daily: Bullish till EOD > 6225
Weekly: Bullish till EOW>6080
Monthly: Bullish till EOM>5970

From a trading perspective, options may not be able to give the desired results. it is safe to buy Nifty futures in the 5950-6025 zone and to sell in the 6225-6325 zone with Long SL EOD < 5944 and Short SL EOD>6380. March '14 can get exciting in the period 15th March to 26th March [Spring Equinox due on 21st March '14]

Until the election event does not get out of the way, it may be difficult for retail traders to rake in some meaningful profits. Sectoral churning is on-going in every leg of fall or rise on Nifty. There are comments like 2 upper circuits for BJP/NDA election outcome etc; May and June near strike Calls and Puts are going at 350 rupees on each leg. IMHO, those who are expecting a bumper with the election outcome may end up losing money just as was the case with INFY options in 2013. Over a period of time, as many players enter the field with the same information, it becomes very difficult to make those gains due to high participation.

In my opinion as far as Nifty is concerned, one should just look at the Support/Resistances and trade accordingly.
Nifty Levels: 5944-5971-6025-6080-6125-6180-6225-6280-6325-6380

2 consecutive closes below 5944 opens for retest of 5740
2 consecutive closes above 6380 opens Nifty into uncharted zone

Gold and Silver have perhaps found their bottom in rupee terms. The prices will be more or less stable for the next few weeks and falls must be used to buy.

Last week of March will reward traders handsomely IMHO

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