Update for 3rd February 2011

Nifty Future Goes Nowhere !

• Following the cues from the overnight rally on Wall Street and the resultant gains in the Asian markets, Nifty futures opened higher at 5491 on Wednesday.
• Therefore, the expected opportunity for a quick contra-trend long trade didn't materialise at all on Wednesday.
• Whenever the market opens away from the previous day's close and in the absence any significant price moving reasons, markets ( read traders ) have a tendency to test the the previous close.
• As such,  Nifty futures sold off from the higher open and recorded an intra-day low coinciding with indicated support / reference level at 5450. 
• Following five day's continuous losses, Nifty future was expected to close in the positive territory on Wednesday.
• It seemed that Nifty future may close above the 5475 levels till around 2.30 PM.
• However, the ghosts of the 2G scandal again visited the Dalal Street in the form of news reports of arrests made in the case.
• The hopes of a respectable close after five days of continuous losses were taken away  by the ghosts and skeletons from the cupboards as the markets again sold off in the last hour of trading.
• However, Nifty futures still closed with some meager gains, not belying all the hopes of a positive close.

Nifty Futures - Intra-day Chart   

Update for 2nd February 2011

    Nifty Futures Approaching the Interim Support of 5350 !

• Following the intra-day bounce on Monday, Nifty futures opened slightly higher at 5542 on Tuesday.
• However, sellers emerged right from the opening bell and the selling  lead to the Nifty futures falling to the previous day's lows in the morning session.
• The losses were widespread and some of the better stocks too joined the bear bandwagon on Tuesday possibly indicating institutional selling.
• Nifty Futures kept on trading around the 5450 reference area for some time in the middle session, but another bout of selling in the afternoon session lead to a new daily low and a close near the low.

Nifty Futures - Intra-day Chart  

• Nifty and the major indices have lost continuously for the past five trading sessions by now.
• Even if the market is poised to go down further, markets do not fall continuously for more than five to six days in normal cases.
• As such, it seems that the market is poised for a bounce and a positive close, at least for a single trading day.