Update for 22nd March 2011

  Nifty Future Poised Above the 5350 Support !

• In the last post we said that the battle for the 5400 strike ( of Nifty Put Options ) is on and the result  of the battle is yet to be known.
• However, Monday's ranged trading has not yet  lead to the resolution of the said battle. Yeah, the battle for the 5400 strike is still on.
• Nifty futures opened slightly higher on Monday. It sold off towards the previously indicated lower support of 5350 in the morning session. The recovery from the low of 5357 ended at 5425, amid all round positive gains being recorded by stocks in all the major markets. Nifty futures finally closed lower at 5387.
• The rising crude oil prices, worsening politics etc. seem to have started to affect the market negatively at present. It seems that the gains in the other major stock markets on Monday has helped Nifty futures to hang on to the 5350 support. 
• The technical position of the market has not changed at all on Monday. Therefore, all supports ( 5350 & 5200 ) and resistances ( 5450, 5500 & 5550 ) as well as the different market scenarios discussed in the previous post(s) still remain valid as of now. 
• As a matter of abundant caution, it may be noted that most of analysis and systems may fail if the market remains in a trading range. As such, if the Nifty contracts are not breaking the 5350 support, it may lead to a covering rally towards that  upper resistances.

  Nifty Futures - Intra-day Chart

    Nifty Futures  - Daily Chart 

Update for 21st March 2011

 Battle for the 5400 Strike is On !

• Here is a quote from the last post " Market has been spooking the bulls and bears alike for some times now. Now the only question remaining to be answered is whether the market is going to spook the straddle and strangle option writers in the current month or not ? Any breakout by the Nifty either way may lead to a scramble for covering by the option writers ! "
• We wrote this comment after the indication of a new sell signal by the Momentum Signal system on Thursday, in a market which seemed to be predominantly flat till then.
• The market heavyweight stock Reliance provided the ammunition for the sell off on Friday.
• Friday's sell off has forced some of the Put options writers to cover their open Put option positions for the  5400, 5600 and 5500 strikes.
• However, the battle for the 5400 strike is still on as the Nifty future is still inside the broad trading range of 5350 and 5550.

  Nifty Futures - Intra-day Chart

    Nifty Futures  - Daily Chart