Nifty -Technical Observation-3-11-14

NIFTY CLOSED AT 8322.20 ON 31-10-14

SUPPORT: - 8322 / 8290 / 8180 / 8160 / 8085.

RESISTANCE:-  8331 / 8355 / 8400 / 8435 / 8475 / 8872 & 8935 .

(Figures in bold are important)

Nifty opened with a gap up at 8200.80 and made a low of 8198.05 and thereafter steadily moved up during the entire day and made new all time high of 8330.75 before closing the day near the high at 8322.20.Technically it is exhibiting tremendous strength and indicate that this on-going up move may continue for few more days before the correction sets in. Here once again I would like to make a cautionary note that with today’s gap it had left 4 gaps in 9 trading session and did not make any effort to fill these gaps ,is slightly disturbing, and if it makes an effort to fill the gap in coming days nifty can slide to 8181 / 8037 / 7936 & 7819 levels, furthermore today’s move seemed to be euphoric  and this may continue for few days but it is  concerning and indicate that we may be topping out for the time being in the next few trading session therefore trade cautiously. But since it is showing good strength as of now therefore adopt buy on dip strategy but get alerted in long trade below 8180 and exit trade if it closes below 8150. Going up it can face very stiff resistance at 8360 / 8435 & 8475 and I  feel that this up rally may exhaust around these levels,so I expect that the nifty may go in for correction by  the middle of the next  week starting from 3-11-14,therefore,I would suggest that one should at least  book part profit on the rise on existing long trade.

REMARK:- Long term trend is still up ,so one can try long trade on dip and get alerted if starts trading below 8180 and exit the trade if it closes below 8150 or above 8332 with a stop loss close below 8250.I would prefer to hold on to the existing long trade and initiate fresh long trade only above 8332.    

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

Contact me for strategic guidance to enter and exit the trade