This opening was expected considering the fact that Dow was butchered on Friday and surging crude price. The effect was global and most of the Asian markets also followed suit. We were no exception. The only difference was that over the weekend most of the people were rambling something about Black Monday and lower circuits etc. We did fall but lower circuits?? Na not yet! You see the difference between the fall we had in January and now are that the former was more a culmination of euphoric rally where many participants were caught on the wrong side. Adding to their woes were margin calls which did more damage to the accounts and some were wiped off completely. In this fall we are seeing gradual decline and most due to the selling in the cash market and lack of any buying conviction. Now moving on to today’s Nifty action. Like I said we just opened inline with global cues. It remains to be seen what will be the follow through of this move, considering the fact today was more of a domino effect. We have pricked the lower support levels and now it needs to be seen weather this prick will hold or break the ground below. If the overnight cues get to be positive then one should use the rally to book profits and stay on the sidelines. If Nifty spot trades comfortably above 4530 then one can take a small long position with a tight stop loss at 4500 and play the intraday strength (pullback).
"You may be disappointed if you fail, but you are doomed if you don't try."
Beverly Sills
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