Nifty futures was unable to break below the 4800 level, hence found strong support there and we are expecting some sharp pull back starting with short covering and profit booking, this rally must be irrespective of the global markets. The support level which nifty has touched last Friday indices has bounced off those level in intraday trading. Market participants mainly the FII are net sellers in the markets they sold the shares worth Rs.910 crores on last trading session. However we think DII and HNI’s are placing their bets on long side from the current levels so this crucial level should hold and 200 points rally can be expected from here in near term, before any down side. We cannot say that downside has ended here, as the global events may create more selling pressure than the domestic events. So keeping this in mind we advice traders to take a contrarian call on nifty futures by placing buy orders in nifty futures near 4815 level for short term targets as 4990 and then 5165 level. This strong support is the Fibonacci level of recent high and lower levels. Taking a look at the charts we see that 38.2% Fibonacci level do lie at 4799 level so a bounce can be expected before any upmove. The technical indicators are still suggesting the downtrend but our call is contrarian and a tight stop loss must be placed on nifty futures just below the 4770 level on closing basis only. Nifty futures has also tested its lowest trading level last Friday. We have already predicted this fall in the previous week analysis that markets must undergo some deep correction. All the news and events are going against the markets and we have seen the Dow Jones index, S&P 500 and NASDAQ has corrected by more than 7% last week, this is very bad for all the global markets. Even the large cap stocks has seen decent correction, like TATA Motors, TATA Steel, Reliance Industries, Sterlite Ind, JP Associates, DLF, ACC, and all the major banking stocks like State Bank of India, ICICI bank, HDFC bank, Kotak Bank and Punjab National Bank has also been the major looser. At current market price we can see that many stocks are available at threw away price and we will recommend investors to invest their 25% of amount in large cap stocks that are discussed above.
Nifty Futures Levels Next Week:
Resistance: 5000 / 5165
maulik khan says
Bhaveek, stop loss in this call was triggred in yesterdays session, but i still have long position. please suggest what can be done now book loss or buy more nifty.
Bhaveek Patel says
Maulik you should book loss in your nifty future long trade, as trend for markets is bearish in coming week. We dont any change in trend, however some bounce can be seen.