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Tuesday, May 24, 2011

Update for 24th May 2011



   Nifty at the 5350 - 5400 Support Area !


Nifty futures have reached the earlier indicated support area of 5350 to 5400. The trailing Price Earnings Ratio ( PER )  has also reached  it's one and half year lows. The index has support from the lower boundary of the old trading channel ( see the weekly chart in the previous post ) below the present levels. Another support is from the previous swing low area at 5175 to 5225. If the index could remain inside the trading channel we may see a bounce from these areas. However, a break of the old trading channel may lead to a much deeper correction. Therefore, it remains to be seen whether the Nifty index could remain inside the trading channel if slowing growth and profits continues.  

    Nifty Futures - Intra-day Chart 



    Nifty Futures  - Daily Chart  





  Nifty Options Scene   

The May series Nifty Options Put Call ratio ( PCR May series ) increased slightly to a below normal and bearish looking 0.63 times on Monday. The below normal PCR may indicate the negative bias of the market. 
 
 Nifty Trailing Fundamentals    


The trailing Price Earnings Ratio  ( PE Ratio ), Price to Book Value ( PB Ratio ) and Dividend Yield ( DY Ratio ) of the Nifty Index  were at 19.93, 3.38 and  1.25 respectively as on  23rd May 2011.  ( More information and a long term analysis on Nifty historical valuation are available from the "Nifty Fundas" page ).


 Latest Ultimate Momentum Signal 


The Momentum Signal has remained in the negative momentum territory  with a value of  -100 as on Monday.

Projected Momentum Signal Close Values

The projected levels of Momentum Signal values applicable to various ranges of closing values of the current month Nifty Futures, Nifty Index and the BSE Sensex,  as at the close of next trading day, ie. as on 24th May, 2011, are given in the following table. All readers are requested to take note that the table below is just a ready reckoner for the next day's Momentum Signal values and the figures are not intended to be interpreted as any targets for the Nifty futures or indices shown therein.
 
 
Click on the table above for an enlarged view.


Readers are also requested to go through The Signal, Entries and Exits, Position Limits, Risk Factors, Risk Analysis,  and FAQs pages to gain a reasonable understanding of the trading system. Please do post your  comments and suggestions on how new  posts can be made more useful.

Cheers and Prosperous Investing and Trading !!!


 
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