Om Sri Ganeshaya Namaha

Om  Sri  Ganeshaya  Namaha
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Tuesday, August 3, 2010

Reigning The Nifty 3rd August , 2010

Daily Chart

Nifty took bears by surprise with a gap up opening on the futures by more than 30 points.Of course as mentioned yesterday, the half hourly oscillators had shown a positive divergence and shorts needed to be prepared for a pullback.

A higher high and higher low candle was formed raising hopes of a rally. Breadth was positive but volumes failed to impress. Trading was up all day with minor pullbacks leading to a breakout from the short term downtrendline from 5477 highs. The close at 5431 is above the 61.8% retracement level of the fall from 5477 to 5349  and above all the short term , 5-10-20 demas. Rsi 14 and Obv  on daily charts has given a minor positive divergence.The half hourly  10-20-50 ema   are once again bullishly aligned. These are bullish signs and Nifty may retest 5477.

The potential head and shoulder bearish pattern which is now visible on the daily charts too, has the neckline at 5350 .The range between 5350 and 5477  becomes a no trade zone as only a break above or below the range will give a directional move.

Supports are at  5417-5407-5400-5383  and  Resistance at  5438-5450-5477

Happy Trading !!
Lakshmi Ramachandran

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