Wednesday, April 22, 2009
Reigning The Nifty --23rd April,2009
"The consolidation / distribution continues and I am waiting patiently for confirmation whether we break up or down. This rally has had 3 breathers and we are into the third one. The earlier 2 lasted for 3 days and 4 days as shown on the daily chart , including the day of the high. The present breather has completed 4 days. So today's action may be crucial to forming an opinion about future movement. I would be on the lookout for a sell sign more than a buy sign at this moment in time."
The third breather is now into the 5th day as the Nifty took support on the falling wedge, exactly at 3297 . However it did break the "inside day" breakout level of 3354 mentioned in the weekend report. Break of 3307 was anticipated and did happen intra day but finally closed above it keeping confusion intact. Yesterday was the 4th down day and 3rd in a row which is happening for the first time since thie upmove from 2539. Also each day has a lower close. So bias is bearish. ".
The verdict is 'cautiously bearish" . New terminology by me. (I have only heard of "cautiously optimistic".) One can take light short positions or else use options . I would not recommend going bearish 'naked' as the fall seems " hesitant ".
Madhu has asked me "why should we not wait for 2865 target if wedge on 30 minute charts has broken?" Yes, one could do that and the decision is yours. Since I am not running a paid service I do not give definite calls of this type. If I do then it becomes my responsiblity to see my readers through the trade, meaning I must tell when to get out too, which most blogs giving free calls do not do. I would want the reader to be guided, but the final decision of taking the trade should be yours. I hope I am clear and not misunderstood.
Sudhin, I have given you 100%. Other queries I will answer over the weekend.
All relevant supports and resistances are marked on the charts.
Happy Trading !!