July 10, 2014

Market outlook

A volatile day with a trading range of almost 300 points and close near open. This day also saw a drop of 12% in VIX.

Note that this has come near a support area of 7500. This level has seen substantial put writing from the start of the series indicating that option writers do not expect this level to break in JULY.

This level also happens to be a swing low and a large/ tall candlestick with a small body implies that bulls and bears were aggressive yet no one really won.

For tomorrow, today's high / low is important. Crossover above day's high will obviously be bullish while break and close below 7500 can be bad.


Intraday charts

On 5 min charts, we had first sell signal around 11.30... this got stopped out at the 12.15... the subsequent rally gave very good gains and got stopped out at 2.40pm.

These levels are marked with horizontal lines.


On hourly charts, nifty will be a buy on close above 7730 spot. If you are already long, your SL will be day's low.



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