|
| US data point to positive opening on Monday |
| B G Shirsat / Mumbai Aug 29, 2010, 00:03 IST |
|
As expected, the Nifty fell below the support level and closed around 5,400 on weak global cues. The Dow Jones closed on a strong note on Friday after better-than-expected US GDP numbers indicated a positive opening for the Nifty on Monday. The bears seem to have their best on the first day of the new series, taking the index below its immediate support by building selling pressure in the last 90 minutes of trade.
This correction could take the Nifty around 5,350 and lead to a sharp recovery thereafter.
The September futures closed at a premium to the spot and added over 600,000 lakh shares in open interest (OI), indicating some long build-up at the lower level. On weekly market picture charts, trading data hinted at a bounce-back above 5,500, while volume based resistance might come around 5,527. The point-of-control, the price level where the market has spent the most time trading, suggests a price level of 5,575 going ahead. Even so, if the Nifty falls below 5,400, it has strong support around 5,350.
The trading volume in Nifty options last week hinted at a trade below 5,400 in the near future and a strong rally thereafter. Traders bought the 5,200-strike put of the September series to protect the downside, but sold the 5,300-5,400-strike puts, pointing at strong support around 5,400. Participants also sold the 5,500-strike puts on expectation of a strong rally above 5,500. The change of hands was seen at 5,500- and 5,600-strike call options, which hinted at a strong resistance above 5,500.
The weekly trading pattern in key stock futures indicates a strong rally in Infosys Technologies, State Bank of India (SBI), HDFC Bank, Reliance Industries and ONGC. ICICI Bank is expected to see a minor correction with support around Rs 940. The weekly time-price opportunity charts hint at a price range of 2,965-2,985 for Infosys, Rs 2897.50 for SBI, Rs 167.50 for ITC, Rs 2,270 for HDFC Bank and Rs 1,004 for Reliance Industries. ONGC is expected to move up around Rs 1,352 from current close of Rs 1,302.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
