Update for 4th February 2011

 At Last the Bounce Happens, But What Now ?

• Nifty futures opened on Thursday exactly where it closed on Wednesday.
• After the open at 5432, the Nifty futures contracts traded between 5425 and the reference level of  5450 for a short time.
• But once the Nifty contracts crossed the reference level of 5450 on the third test, the contracts rallied strongly towards the previous day's high of 5510.
• But the previous day's high was only a minor obstacle in the path of the Nifty contracts as it rallied further for a test of 5450. 
• The Nifty contracts traded in a tight range between the previous day's high and the day's high of 5545 for the rest of the day and finally closed at 5539.

Nifty Futures - Intra-day Chart    

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