Nifty futures has corrected from the 5400 level and last 2 days has been very negative for the markets. Even today we have seen the nifty futures trading down by 135 points, at this point of time nifty has also tested the support of 5184 level which is today’s lowest trading point. We have already predicted this fall in the previous week analysis that markets must undergo some deep correction. All the news are against the markets and yesterday we have seen the Dow Jones index, S&P500 and NASDAQ has corrected by more than 4%, Dow Jones has corrected by more than 500 points, this is very bad for all the global markets and from this morning we have seen all those markets correcting. Even the large cap stocks has seen decent correction, the Indian Oil and Gas giant Reliance Industries has broke below the 800 level and made new 52 low today. This sell off is so strong that advance decline ratio was 1:37, This panic selling came from the major market participants. Today’s correction has warned us about the much deeper correction arriving the markets in near term, we are now bearish in the short term from the current levels. So our near term strategy will be sell at every advance or at the higher levels, also our intraday strategy is sell nifty futures near 5212 level with targets as 5186 and 5155 levels. We advice traders to short nifty futures on every up move. Traders are also advised to place their stop loss with 1:2 risk reward ratio. Technical analysis suggest the market has crucial support at 5183 level which is expected to hold the markets today. Taking a look at the asian markets we have seen Nikkie, Hang Seng, Shangai Comp, Kospi and other major index has also corrected by about 3% at the opening bell itself. Also the commodities and Oil prices will be correcting in the near term as demand will be lower in western countries like US, UK and some European countries.
At 10:20 AM (IST) Nifty was trading highly negative by 123 points. Today’s trend is most likely to be bearish. We may see some short positions to be unwinded in nifty futures near 5195 level, in F&O August series. Nifty Futures trading range is as seen below.
Nifty Futures Levels today:
Resistance: 5322 / 5415
Support: 5182 / 5125
Nifty futures trading analysis (5 August 2011):
Short sell nifty future below 5235 level for intraday target of 5185 and 5130 levels, we recommend to place Stop loss orders above 5255 level.