Indian Equity Markets have made a good rebound from intermediate lows made in the early part of December 2010.
But if we look at the charts carefully, even though it is giving bullish signals, the correction gaps have widen up than before. In other words, the time to recovery is increasing as we move up. It indicates that confidence level is now as good as it was in the lower levels.
But if we look at the charts carefully, even though it is giving bullish signals, the correction gaps have widen up than before. In other words, the time to recovery is increasing as we move up. It indicates that confidence level is now as good as it was in the lower levels.
Then the only reason we have been goin up is the liquidity factor. The long term investors must utilize this opportunity to book profits and wait for a good correction to come. With high current account deficit, rising interest rate regime and high inflation, there has been some serious fine tuning required in the Indian economy before it can resume its meaningful upward journey.
Short term traders must go into the market with strict stop-losses. The logic is not to afraid to book losses quickly.
Technically, we are into bullish zone till the time market crosses 6170-6200. Also RSI which is in mid-50 range can go upto 70-80 levels where we would see an over bought region. In this range, we anticipate another fall to come into the markets.
Options traders can sell Nifty 6300-6400 Calls for January at every rise. In the downward trend, one may sell Nifty 5800-5900 Puts.
Wishing you a great trading time ahead!!!
