EOD Analysis For 1st June 2012 and Outlook For 4th June 2012

OI in Nifty futures dropped significantly to about 17 million today and VIX hovering around the 26 mark

Critical levels and outlook remain unchanged for Nifty and BankNifty; Monday's close is crucial and bulls desperately need a close above 5032 on Monday and that seems highly unlikely with today's price action. If that is the case, we perhaps need to brace for some more range bound moves until 20th June as well

On downside, 4800 holds the key [4750 is the last hope for bulls to achieve 5630-5740+ by Diwali]

Over the last couple of sessions, I have been getting queries on Tata Motors and allow me to put forth the chart and potential labels on lower time frames

EOD Analysis for 31st May 2012 and Outlook For 1st June 2012

OI in Nifty futures actually dropped a couple of million on expiry day compared to yesterday.

Critical levels and outlook remain unchanged for both Nifty and BankNifty from previous levels. Monday EOD will be crucial to determine the potential range for the next 2 weeks on Nifty i.e. we need to see whether Nifty closes above the 5032 level on Monday or not....

The problem is that rallies even of minor levels are being sold into and hence bulls are so close yet so far.....

EOD Analysis For 30th May 2012 and Outlook For 31st May 2012

OI in Nifty futures moving towards the 30 million mark and we are a day away from May series expiry

Critical levels and outlook remain unchanged for both Nifty and BankNifty

Updating charts until yesterday EOD

Nifty

Following up on Jacs' comment on the EW section last night, from the lows of Dec'11, we did 4531 to 4740 odd levels, fell to 4640 before starting the impressive rally - so even with the bullish stance, a fall to 4800-4840 levels cannot be ruled out before the potential impending rally [difficult to start before 20th June 2012 IMHO] Any rally upto 5944 will only be a relief rally nevertheless that one must always bear in mind


BankNifty

Other Updates

Regarding Rollar, the rise beyond 54.5-55 has definitely stumped many including me but we must realize that it has more to do with Dollar Index than Rupee by itself and the negativity surrounding Rupee is being overdone in the media IMHO. Soon, we should be able to see some stability in the Rollar and a move below 52 in the next 6 to 8 weeks is likely [though the rise above 56 makes a test of 57 levels highly likely] and we may end this year well below the 48 mark [current situation is good for NRIs to convert their forex into rupees and park a good chunk {at least 30%} of it in FDs and Debt Schemes]

Too much is being spoken about the correction in Tata Motors as well but one needs to see the price action and as long as it stays above 220 levels, it is close to the previous all time highs [extrapolating for the stock split] Whilst the slowdown in India is currently being compensated for by the sales in JLR, by the end of this year, it should be the other way around.

Gold: We are yet to see a reasonable impact on Gold prices in India due to the Rollar effect. In USD terms, a bottom is expected to form in Gold around the USD 1350-1450 per ounce, in Rupee terms, seems unlikely to go below INR 23k for this year as of now. As prices march towards 25k mark, one may look to start accumulating again via Gold ETFs [the falls in dollar terms can be faster once prices close below the USD 1500 mark per ounce]

Last but not the least, trading on Futures and Options have been extensively covered in a separate blog section called Futures and Options Paradox and I won't be repeating the same on a regular basis on this blog :D

EOD Analysis For 29th May 2012 and Outlook For 30th May 2012

OI in Nifty futures rose to about 28 million today despite price action in a narrow range for most of the day [typical as we approach expiry]

I had a very fruitful weekend in Hyderabad with WaveRider [spent the entire weekend with him :D] and also managed to catch up with Captain Ramesh and his wife, Naresh and Karjunanji. Food from Ghungroo and Utsav were super duper with generous portions of rice still the same as I had last experienced [and a very pleasant surprise to me considering the ration quota portions in Mumbai and Bangalore] The home vacation has been extremely gratifying so far and look forward to accumulate more happy memories over the next 3 to 5 weeks!

Back to Nifty, I am just sharing the same view that I had voiced over the weekend to our friends in Hyderabad;

On upside, Nifty should be able to break out of the 5032-5092 band by next Monda [Friday 1st June will mark 34 consecutive trading sessions of Nifty closing below the crucial 5032-5092 band; if it does not take out  5032-5092 band on closing basis by 4th June 2012, the odds of staying below this band might be a reality for most of June series as well]

On downside, we Nifty should be able to take support in the 4800-4840 band [4750 last hope for bulls]

On a time scale, we are slowly inching towards Summer Solstice zone i.e. 20th June 2012 [adjusted to a day earlier as 2012 is a Leap Year] from where a major up move should commence regardless of where we are prior to that; if we take out 5225 prior to 20th June 2012, IMHO, the minimum upside target will be 5630 and ideally 5740+ [both these upside targets are for Diwali 2012] If we continue to drift in the 4800-5032 band for most part of June [or for all one knows lower], even then 20th June onwards, we should be able to see a rally on the upside from the lows, just as was the case after hitting 4531 on 20th Dec '11 [21st Dec '11 was Winter Solstice]

One can extrapolate the levels accordingly for BankNifty

To summarize, for the next few sessions, there is no change to the trading outlook i.e. one can comfortably build positional longs and shorts via futures as range-bound moves are anticipated till the end of this week with some whipsaws over the next 2 sessions :D

With regards to the technical glitches on the EW section, I do not prefer to disturb Raghuji during trading hours for administrative stuff - I will talk to him in the evening and figure out a way to avoid inconvenience to our dear readers. With regards to sharing of email address, I am not authorized to do that. Only Raghuji can decide whether and with whom he wants to share his personal contact details incl email address

EOD Analysis For 28th May 2012 and Outlook For 29th May 2012

OI in Nifty futures hovering around the 25 million mark;

Critical levels and outlook remain unchanged for both Nifty and BankNifty

Any significant move above 5092 on closing basis may have to wait until next Monday IMHO