The U.S. dollar was hammered versus the Yen, trading near its seven week low after a large sell-off made safe havens more attractive. One beneficiary was the Swiss Franc, which reached a three week high against the dollar.

Weak Chinese Reports Worry Markets
Markets have been rattled by weak manufacturing reports from China that suggest its economy is slowing down. Manufacturing activity fell in January to the level of 49.6 following a 50.5 performance in December. The announcement prompted concerns in the markets, leading to a move into safe havens like the Japanese Yen and Swiss Franc. It also led to the advance of German bonds to a one month high with yields falling to five month lows.

Securities in Italy fell following the recent news from China, and Spain also found its securities dropping for the first time in recent weeks. The U.S. dollar also continued to be weak, although most of the weakness is thought to be a result of the markets anticipating further tapering by the Federal Reserve.

Euro Strengthens
The Euro gained ground versus the U.S. Dollar for a number of reasons, including the release of PMI numbers. Services and manufacturing beat expectations, and the region’s largest economies except Germany saw robust numbers in both sectors.

The Services PMI in the E.U. beat expectations of 51.5, coming in at 51.9, while manufacturing beat expectations of 51.5 with a figure of 51.9 — the largest increases since the summer of 2011. The Euro strengthened in spite of bearish sentiments expressed by the President of the European Central Bank. The President’s inflation concerns were not shared by many economists who feel the Euro could continue to advance if economic data continues to be positive.

Gold Lifts
The price of gold spiked to its highest level in nine weeks as inflows came from investors spooked by stock market losses and concerns about emerging markets.

Market Outlook
Many economists expect more weakness in the markets as more data emerges from China. The Federal Reserve should also have an impact with further tapering expected to affect the stock market and emerging markets.



Nifty future faces resistance at 6333, Sell on Bounce

by Bhaveek Patel

Nifty future on daily chart was seen testing the all time high level of 6333 many times, but every time it was rejected from that area. This gives us an idea that, market participants are not seeing fresh all time high any time soon. So we have seen, selling at those higher levels in nifty as well as in bank nifty futures. Banking and real estate stocks were the major dragsters in this sell off. […]

Nifty future: Trading the last day of Month, Week and Year

by Bhaveek Patel

As the year 2013 has ended, there were traders on the floor who were making their last smart move on the last trading session of the year. Those people are called “Professional traders“. So if you didn’t knew the importance of the that last trading session, you have missed one of the finest trading opportunity. But still its not so late to prepare yourself for a great trading idea in 2014. Why is last day, […]

How to read India VIX and Trade volatility in Nifty

by Bhaveek Patel

In India, markets have seen significant increase in the volatility index. We have VIX in NSE, which have recently been inching towards 20. Let us see in detail how VIX is used in trading nifty future. Few traders are using VIX to see the correct direction of Nifty future and also find the correct and most probable reversal point. VIX also defines the risk for the nifty positional traders and also option writers. What is […]

Bank Nifty closed at a crucial decision area, Trading analysis

by Bhaveek Patel

Bank nifty future on last Friday has closed at a important decision level which will give a trading idea for next week. Last Fridays closing was a very important as we have seen a very negative candle closing around the days low. Also Bank Nifty future has underperformed Nifty future as we were expecting. The crucial area on daily chart for bank nifty is 12000, from where we will see some bounce or even a […]

Positional Trade: Buy HDFC Bank, Stock trading at support

by Bhaveek Patel

HDFC bank has traded at the support area of the 680. We have seen on the charts that stock is in a strong uptrend and hence our focus is to look for trades on the buy side. Hence, if the stock rallies towards the support we will be looking to buy into the stock. Banking sector has been under-performing nifty future, but on the charts we came to know that the selling was due to […]