MARKETS FOR 5TH SEPTEMBER

NIFTY AS EXPECTED BREACHED MONDAYS LOW OF 5243 AND ALSO BREACHED LAST WEEK’S LOW OF 5239 TO MAKE A NEW LOW AT 5233. BUT THE WAY NIFTY BOUNCED UP TO A DAY HIGH OF 5278 FROM THE LOW OF 5233 TO FINALLY CLOSE AT THE HIGHEST POINT OF THE DAY AT 5278 (AVERAGED CLOSE FOR SPOT NIFTY  IS 5274) IN THE FORM OF A BULLISH ENGULFING CANDLE TO THE CANDLE OF MONDAY IS TECHNICALLY A SIGN OF STRONG BULLISHNESS,  ALTHOUGH IT HAS ALL
THE HIDDEN QUALIFICATIONS OF ANOTHER PERFECT BULL TRAP. ALTHOUGH THE BREACH OF THE CRITICAL 50% LEVEL OF 5240 TO GO TILL 5233 IS NOT THAT ALARMING AT ALL, YET AS LONG AS NIFTY CONTINUES TO MAKE LOWER LOWS  WITHOUT MAKING HIGHER HIGHS IS CERTAINLY A SIGN OF WEAKNESS. TRADERS & INVESTORS HAVE TO KEEP IN MIND THAT NIFTY HAS TO MAKE A CLOSING ABOVE THE HIGH OF THE PREVIOUS DAY FOR A DAY OR TWO IN ORDER TO SIGNAL END TO THE CORRECTIVE PHASE.

FOR WEDNESDAYS TRADING PURPOSE, SPOT NIFTY HAS  INITIAL RESISTANCE AROUND  5278 WHICH WAS THE LAST TRADED PRICE OF SPOT NIFTY. A CLOSURE OF A 30 MINUTE CANDLE ABOVE THIS CRITICAL LEVEL OF 5278 WILL SEE SUDDEN EMERGENCE OF SHORT COVERING TO PROPEL SPOT NIFTY TOWARDS THE CRITICAL LEVEL OF 5286 WHICH WAS THE HIGH OF THE GREEN MONSTER CANDLE AS WELL AS THE OUTSIDE BAR OF JUNE MONTH. THE SHORT COVERING EVEN CAN PROPEL SPOT NIFTY TOWARDS 5296, 5303 AND ALSO 5313 LEVELS. SIMILARLY ON THE LOWER SIDE, A FAILURE OF A 30 MINUTE CANDLE TO CLOSE ABOVE 5278 MAY ENCOURAGE CARGO SHORTING TO SEE NIFTY SPOT BEING HURLED DOWN TOWARDS  5255 THAT WILL DECIDE THE FURTHER FATE OF SPOT NIFTY . A CLOSURE OF A 30 MINUTE CANDLE BELOW 5255 OR 5250 SPOT CAN CONFIRM THAT THE TUESDAY’S LAST HOUR SPURT IN SPOT NIFTY WAS NOTHING OTHER THAN A WELL CONCEIVED PLAN OF THE OPERATORS TO GENERATE A PERFECT BULL TRAP TO MASSACRE THE BULLS ON WEDNESDAY IN WHICH CASE RETEST OF 50% LEVEL OF 5240 TOWARDS TUESDAY’S LOWS OF 5233 OR 5235 IS A CERTAINTY.

SO, FOR INTRADAY TRADERS, FAILURE TO BREACH & MORE IMPORTANTLY SUSTAIN ABOVE TUESDAY’S HIGH OF 5278 SPOT LEVELS  CAN BE RUTHLESSLY SHORTED FOR QUICK GAINS BY HAVING STOP LOSS A FEW POINTS ABOVE IT TO REVERSE FOR LONGS. IN CASE SPOT NIFTY SLIDES BELOW  5250 SPOT ZONE, THEN ALSO ONE MAY ADD MORE SHORTS IN A RHYTHMIC FASHION FOR QUICK GAINS TOWARDS 5235 OR TOWARDS NEW LOWS BELOW TUESDAYS LOWS OF 5233 TOWARDS 5226 OR 5220 TO 5210 SPOT LEVELS  FROM WHERE ONE MAY COVER THE SHORTS TO THINK OF BUYING FOR QUICK GAINS WITH A WIDER STOP LOSS. A FAILURE TO BREACH & SUSTAIN BELOW 5255 TO 5250  SPOT ZONE MAY BE BOUGHT FOR QUICK GAINS BY HAVING STOP LOSS BELOW IT  TO REVERSE FOR SHORTS FOR QUICK GAINS. A RISE AFTER THE INITIAL FALL TO MOVE UP AND BREACH 5278 SPOT MAY BE A BONANZA FOR INTRADAY BULLS AS IN THAT CASE  THE SHORT COVERING ACTION BY THE WEAK BEARS ITSELF ABOVE SPOT 5278 MAY ACT LIKE A BOOSTER DOSE BEHIND THE  CONSTIPATED BULLS.

Source:Queens Trade