Nifty Seems To Be Heading For Lower Levels In Coming Days

NIFTY CLOSED AT 7859.95  ON 10-10-14

SUPPORT: -  7855.95 / 7841.80 / 7808.85 / 7784 / 7070.05 / 7593 / 7540.10 / 7422.15.

 RESISTANCE:- 7925.15 /7960.50 / 7964.80 /7972.35 / 8030.90 / 8141.90 / 8160.90 / 8180.20.

   (Figures in bold are important)

After a long holiday nifty opened the week  under review on a weak note at 7897.40 on 7-10-14 and went further down further the next day and made a low of 7815.75 ,it staged a sharp recovery  on 9-10-14 and made a high of 7972.35 in this process it  tried to move above the short term moving averages upper band also but could manage to close in the mid range only  at 7960.55,but it could not sustain it and fell sharply the next day and closed the week at 7859.95 slightly above the lower mark of 7815.75 for the week. I once again reiterate that nifty seems to have topped out at 8180.20 for now.(see my earlier post)

The technical chart is exhibiting gross weakness and is precariously poised too and if it breaks the level of 7800 chances of which are looking reasonably high then nifty  will be heading for 7784 / 7700 / 7593 & 7530 level. Looking at the other technical parameter nifty is likely to test the range of 7500-7600 in coming days. Furthermore it is still making lower top and bottom and also below its all short term moving averages and the range for short term DMA is between 7996—7897(it changes every day) for 13-10-14, therefore long trade is completely ruled out for me till it reasonably bounces back above the upper band of the DMA i.e 7996 and stays for 3-4 days or start making higher top and bottom. I would prefer to go short on the rise now with a stop loss 8010.I would advice to avoid long call below 7815.75 for sure for the entire week starting from 13-10-14 and below 7840 for the entire month of Oct-14 however contrarian and aggressive trader can try long call near the critical point at 7840 /7800 / 7700 & 7540 with an adequate stop loss. Kindly note that technically it is sell on the rise market as of now.

REMARK:- Long term trend is still up but it is in intermediate downtrend  and since it below its all short term moving averages therefore long trade is completely ruled out till it bounces back above it again and stay for 3-4 days ,therefore I would suggest to go short on the rise  with a stop loss of close above 8010.  

Kindly note that make your cost your stop loss in favorable trade and then trail it as the price move up/down to gain maximum profit and avoid losses. Use support and resistance levels as entry, exit, target and trailing stop loss points. DO NOT TRADE WITHOUT STOP LOSS.

Note: Price stated here is of spot market

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