BANKNIFTY AND NIFTY FUTURES LEVELS FOR 11TH AUGUST 2014

BANKNIFTY FUTURES LEVELS FOR THE DAY

BANKNIFTY RANGE FOR THE DAY IS 14690-14950
Resistances are at 14880-14930 and supports at 14760-14700
Above 14970 is a range breakout with further targets/resistances placed at 15045-15140
Below 14680 is a range breakdown with further targets/supports placed at 14540-14450
BankNifty Futures is strong only above 14855

NIFTY FUTURES LEVELS FOR THE DAY

NIFTY RANGE FOR THE DAY IS 7545-7635
Resistances are at 7610-7627 and supports at 7571-7554
Above 7636 is a range breakout with further targets/resistances placed at 7655-7682
Below 7545 is a range breakdown with further supports/targets placed at 7525-7500
Nifty Futures is strong only above 7600

Trading strategy for 11th August 2014

The market closed the week with the Sensex at 25329 lower by 151 points while the Nifty ended at 7568 down by 34 points after recording losses on three of the five sessions amid mounting geopolitical worries over Iraq, Libya and Russia/Ukraine tension. The market witnessed further sell off during the later part of the week over U.S. authorization to target Iraq to halt the advance of ISIS. Meantime, market will be keenly watching the last batch of Q1 results and CPI/WPI data for July 2014 to be announced during the week. Readers are advised to trade with caution keeping stock specific approach.

NIFTY FUTURE (Last close 7591.65)
The counter closed the week losing marginally amid high volatility and intra week swing of over 225 points led by sell off in later part of the week. The counter this week may remain in the range of 7521-7682, break above it may move up to 7705/7749 or else break below it may slide to 7496/7467. For today’s trading the counter to gain strength needs to trade and remain above 7608.75 whereby it may move up to 7632/7648. Strong support for the counter exists at 7575.25 which if breached decisively with volumes then it may slide to 7557/7533.

BANK NIFTY FUTURE (Last close 14819.70)
The counter closed the week losing a whopping 391 points amid high volatility and intra week swing of 666 points. The counter this week may remain in the range of 14613-15025, break above it may move up to 15102/15182, or else break below it may slide to 14554/14508. For today’s trading the counter to gain strength needs to trade and remain above 14868.75 whereby it may move up to 14902/14943. Strong support for the counter exists at 14769.25 which if breached decisively with volumes then it may slide to 14716/14674.

DR. REDDY’S LAB FUTURE (Last close 2786.05)
The pharma stock after consolidating during the past sessions closed the week gaining over 1% with moderate volumes. The stock appears positive on charts and may move up to 2798/2816 on volume trading. Strong support for the stock exists at 2775.00.

HERO MOTO FUTURE (Last close 2592.95)
The stock after consolidating during the past sessions closed the week with moderate volumes gaining about 2%. The stock appears positive on charts and may move up to 2603/2618 on volume trading. Strong support for the stock exists at 2581.25.

FREE EQUITY CALLS IN MARKET HOURS – 11.8.2014

Buy above 7570 Tgt 7592,7625 and 7650 (Nifty Spot Levels)

Sell below 7540 Tgt 7515, 7489 and 7450 (Nifty Spot Levels)

Nifty ( Spot ) : The crucial support for the Nifty is at 7550 – 7450 – 7400  and the resistance is at  7600 – 7650

Pre-market Future Call ( Intraday) :

       DLF   —   Buy above 196  StopLoss 192.30 Target 200 , 202

                     Short Sell below 192  StopLoss 196 Target 188 , 185

HINDALCO  —  Buy above 185.70  StopLoss 182  Target  189 , 192

                     Short Sell below 182  StopLoss 185.70 Target 178 , 175

Nifty breaks 50 SMA, FII Data Analysis

• FII’s sold 72009 contract of Index Future worth 2720 cores, 44.4  K Long contract were squared off and 27.5  K short contracts were added by FII’s. Net Open Interest decreased  by 16.9  K contract.FII’s went into panic mode today after a big gap down and squared off Huge Long Position in Index Futures which were getting rollovered from March Series. This Kind of single day selling was seen way back in 2010 so looks quiet scary.The surprising thing is that NF range today was just 58 points and we saw no major decline in Nifty after gap down suggesting FII’s were able to exit there long position without creating any major panic in MARKET.

• Nifty closed below its 50 DMA, after big gap down today, Here is the interesting part Last time NS broke its 50 SMA was on 27-Jan with a gap down and corrected almost 255 points or 5% to make major low @ 5933 in 7 TRADING session and started the big rally till 7836 Today also NS broke its 50 SMA with a gap down Will History Repeat ?   As per EW we can start the iii wave on hourly chart with break of 7595 which can take all the way to 7503. 
  

• Nifty Future Aug Open Interest Volume is at 1.22 cores with liquidation of 8.8 lakh suggesting long liquidation with increase in CoC. VIX being very low suggests bulls are still overconfident and every dip is getting bought into.
  

• Total Future & OPTION TRADING volume was   at 1.96   lakh core with total contract traded at 2.60 lakh. PCR @0.87.

• 8000  CE  OI at 55.8  lakh  suggesting wall of resistance , 7600 CE saw addition of 12.9 lakh  suggesting bears are getting stronger @ 7600.FII’s bought 1.9 K CE longs and 13.6 K  CE were  shorted  by   them. Huge short in CE needs to be taken by caution.
  

• 7500 PE OI@ 55 lakhs saw liquidation of 2.8 lakh suggest bulls are getting jittery near 7500 , 7600 PE has 9 lakh liquidation in OI,  and 7700 PE also liquidated  7 lakh OI , suggesting if nifty opens with gap on MOnday will get sold into..FII’s bought 42.4 K contract  PE longs and 11.7 K  shorted  PE were covered  by them.Again FII are covering shorted PE and shorting CE suggests net to net basis going short in Nifty in Option segment also.

• FIIs sold 503 cores in Equity and DII bought 456 cores in cash segment.INR closed at 61.14.

• Nifty Futures Trend Deciding level is 7588 (For Intraday TRADERS). NF Trend Changer Level (Positional Traders) 7696  and BNF Trend Changer Level (Positional TRADERS) 15215 .How to trade Nifty Futures and Bank Nifty Futures as per Trend Changer Level . 

Trading strategy for 8th August 2014

The market after flat to weak opening yesterday closed the session with the Sensex at 25589 down by 76 points after making a high of 25778 and a low of 25526 while the Nifty ended at 7649 down by 22 points. Market participants remained worried over geopolitical concerns over Ukraine and Russian tension and preferred to exit at higher levels. The market breadth remained weak as 1377 stocks advanced while 1678 declined. Readers are advised to trade with caution keeping stock specific approach.

NIFTY FUTURE (Last close 7669.65)
The counter after weak opening yesterday moved with negative bias till mid-afternoon when it witnessed hectic buying taking the counter to 7750, very near to the level indicated in these columns which however, remained short lived and slipped to session low of 7650 on profit taking, and finally closed with marginal loss of 21 points. The counter to gain strength needs to trade and remain above 7683.75 whereby it may move up to 7707/7719. Strong support for the counter exists at 7648.75 which if breached decisively with volumes then it may slide to 7626/7609.

BANK NIFTY FUTURE (Last close 15066.50)
The counter closed yesterday with marginal loss of 25 points amid high volatility of 190 points making a high of 15216 and a low of 15026. The counter to gain strength needs to trade and remain above 15125.75 whereby it may move up to 15162/15207. Strong support for the counter exists at 15029.25 which if breached decisively with volumes then it may slide to 14964/14912.

RELIANCE FUTURE (Last close 992.80)
The stock after consolidating during the early part of the week closed yesterday above its weekly buy signal with moderate volumes gaining marginally. The stock appears positive on charts and may move up to 998/1006 on volume trading. Strong support for the stock exists at 986.25.

SRTRANFIN FUUTRE (Last close 912.55)
The stock after consolidating during the past sessions closed yesterday above its weekly resistance with moderate volumes gaining over 1%. The stock appears positive on charts and may move up to 918/924 on volume trading. Strong support for the stock exists at 905.25.

BHEL FUTURE (Last close 229.45)
The stock after consolidating during the early part of the week closed yesterday above its weekly resistance with moderate volumes gaining over ½%. The stock appears positive on charts and may move up to 232/234 on volume trading. Strong support for the stock exists at 227.25.

Nifty chart: a mid-week update

The RBI governor expectedly kept interest rates unchanged. Keeping inflation under control has been his (and his predecessor’s) priority. The SLR rate was cut by 50 bps (0.5%) to inject more liquidity in the banking system. But that is unlikely to have any effect in the near term because credit growth hasn’t picked up.

FIIs have been net buyers this week. Even DIIs were net buyers on Tue. and Wed. But while Nifty closed higher yesterday, it closed lower today. LIC will have an INVESTIBLE surplus of Rs 3 Lakh Crores (how many zeroes after 3 does that have?) this year – of which 15% (about  Rs 45000 Crores) will be invested in equities by Mar ‘15. Are you still worrying about a huge correction?!

After forming an upward ‘gap’ (marked by dotted lines) on May 13 ‘14, Nifty has been TRADINGwithin an upward sloping channel for almost 3 months. The lower edge of the channel has merged with the 50 day EMA, whose current level is about 7530. So, keep a watch on that level (on a closing basis). A downward breach may cause a test of the ‘gap’ area – which has remained untested so far.

The up trend line 2 (in blue) and the 200 day EMA are rising together and are currently below the ‘gap’ zone. They should provide stronger support in case Nifty drops down to fill the ‘gap’ – though the chances of that happening seems low at this stage. The only cause for such a drop could be some external factor

.

Volumes have been sliding as Nifty has moved up within the channel. That is a negative divergence, because a bull rally requires volume support. Daily technical indicators are also showing negative divergences by failing to touch new highs with the index. Does that mean a big correction is around the corner?

As George Gershwin wrote: It ain’t necessarily so. Though the indicators are looking a bit bearish, suggesting further downside in the near term, index valuation suggests that any dip will be bought into. So, Nifty may end up consolidating sideways with an upward bias for a while before breaking out higher.

So, what are investors supposed to do? It isn’t necessary to always do something. Some times just sitting back and watching can be useful. Stick to your investment plans, instead of getting excited or disheartened because some stocks are shooting up while others are stagnating. That is the nature of the MARKET.

The long-term trend is up, and in an up trend you MAKE MONEY by entering at a fair price and then holding on – using dips to add. Some times, the urge to take profits is too strong to control. Book part profits and hold the rest with a trailing stop-loss. Otherwise you may miss a multibagger opportunity.

The really big gains come when you enter fundamentally strong STOCKS at a decent price and then control the urge to book profits at every 30-40% rise.

EQUITY CALLS IN MARKET HOURS AND MARKET OUTLOOK – 6.8.2014

Nifty ( Spot ) : The crucial support for the Nifty is at 7700 – 7650 – 7600  and the resistance is at  7775 – 7800

Pre-market Future Call ( Intraday) :

RELINFRA  —  Buy above 777  StopLoss 770 Target 784 , 790

                     Short Sell below 770  StopLoss 777 Target 763 , 757

HDFCBANK  — Buy above 826  StopLoss 819  Target  834 , 840

                      Short Sell below 819  StopLoss 826 Target 812 , 807