MARKETS FOR 30TH MARCH

FINALLY THE EXPIRY DAY MADE  NIFTY BREACH THE FEBRUARY MONTH LOW OF 5159 TO MAKE A LOW OF 5136 TO BOUNCE FROM THERE TO CLOSE AT 5179. THE EXPIRY DAY ALSO SAW NIFTY BREACHING BOTH THE CRITICAL SUPPORT OF 5171 AS WELL AS THE 200 DAY  SMA AROUND 5151. ALTHOUGH NIFTY AFTER BREACHING THESE TWO CRITICAL LEVELS BOUNCED UP TO CLOSE AT 5179 ABOVE BOTH THESE LEVELS, YET IT REMAINS HIGHLY VULNERABLE TO ANY ADVERSE NEWS EVENT TO AGAIN FALL BELOW BOTH THESE LEVELS TO AT LEAST TEST THE 50% RETRACEMENT LEVEL OF 5080 IF NOT THE IMPORTANT 61.8% FIBO LEVEL OF  4949.

NOW, DURING THE MONTH OF MARCH NIFTY HAS MADE A LOWER LOW AT 5136, LOWER HIGH AT 5499 COMPARED TO FEB HIGH OF 5630. THE CLOSING OF NIFTY ON 30 MARCH IS CERTAINLY GOING TO BE BELOW THE FEB MONTH CLOSING OF 5385. THIS MAKES IT A PERFECT OPPORTUNITY FOR NIFTY FOR A SUBSTANTIAL RISE DURING THE MONTH OF APRIL, EVEN THOUGH IT MAY MAKE A LOWER LOW BELOW THE MARCH LOW OR EVEN TEST THE 50% RETRACEMENT LEVEL OF 5080 DURING EARLY APRIL. SO, LONG TERM INVESTORS MAY ADD SUBSTANTIAL LONG POSITIONS DURING FURTHER FALLS TOWARDS 5080 IF AT ALL  IT COMES DURING APRIL MONTH.

IF ONE HAS A CLOSER LOOK AT THE DAILY EOD CHART OF NIFTY, ONE WILL OBSERVE THAT AFTER THE BIG RISE FROM 20 DEC LOWS OF 4531 TILL 22^ND FEB HIGHS OF 5630 WHICH WAS THE 1^ST UP WAVE OF THE FRESH BULL MARKET, NIFTY IS  IN THE PROCESS OF A CORRECTIVE ‘ABC’ ZIGZAG PATTERN 2^ND DOWN WAVE IN THE FORM OF A FLAG THAT MOST LIKELY SHOULD END  EITHER AROUND THE 50% SUPPORT LEVEL OF 5080 OR 5077  OR MAY FALL A LITTLE MORE TOWARDS THE UPWARD LOOKING SUPPORT LINE JOINING THE 20 DECEMBER LOW OF 4531 AND 2^ND JAN LOW OF 4588 WHICH PRESENTLY HAS REACHED ABOVE 5000 MARK. SO, EVEN IF THE CRITICAL 50% SUPPORT OF 5080 OR 5077 ARE BREACHED, THIS RISING REND LINE SHOULD PROVIDE THE REQUIRED SUPPORT TO NIFTY BEFORE NIFTY FALLS TO THE ULTIMATE 61.8% SUPPORT OF 4949. REMEMBER BELOW THE 200 DMA AROUND 5151 REMAINS THE MORE IMPORTANT 89 DAY MOVING AVERAGE AROUND  THE 50% RETRACEMENT LEVEL OF 5080 THUS ENHANCING THE IMPORTANCE OF 5080 LEVEL.

FOR FRIDAYS TRADING  ONE SHOULD EXPECT A GOOD BOUNCE AFTER RETESTING THE EXPIRY DAY LOWS OF  5136 OR IT COULD BE THAT AFTER A MINOR RISE INITIALLY, NIFTY IS BROUGHT DOWN A BIT MORE TO SHOOT UP AGAIN.  A FALL BELOW 5150 WILL WEAKEN SPOT NIFTY  TO SLIDE FURTHER TOWARDS EXPIRY DAY LOWS OF 5136 OR EVEN TOWARDS 5125 TOWARDS 5110 OR 5100 TO BE AT THE STRIKING DISTANCE FROM THE CRITICAL LEVEL OF 5080 WHICH PERHAPS MAY BE PRESERVED TO BE TESTED IN EARLY APRIL. APRIL BEING A HIGHLY MARKET FRIENDLY MONTH AS PER PAST HISTORY, ONE MAY EXPECT A SUBSTANTIAL BOUNCE DURING APRIL MONTH.

FOR INTRADAY TRADING PURPOSE SPOT NIFTY FINDS INITIAL SUPPORT AROUND 5171 BELOW WHICH 5155 , 5145 ARE THE REGULAR SUPPORTS JUST ABOVE THE THURSDAYS LOWS OF 5136 . A DECISIVE BREACH OF  THURSDAYS LOWS OF 5136 SPOT MAY SEE A FALL TOWARDS 5125 THEN 5111 TO 5100 LEVELS. SIMILARLY ON HIGHER SIDE SPOT NIFTY NEEDS  TO DECISIVELY CROSS AND TRADE ABOVE THE 5205 TO 5210 LEVELS FOR ANY UP MOVE TOWARDS 5215, 5226 AND 5235 OR EVEN TOWARDS 5250. A BREACH OF SPOT 5236 WILL ONLY SIGNAL THE POSSIBILITY OF BIG UP MOVE OR ELSE NIFTY CAN SLIDE AGAIN TOWARDS THE LOWER LEVELS. ANY RISE IN NIFTY ABOVE 5200 WILL SEE OLD NEWS  CHANNELS BRINGING BACK  THE NEGATIVE ASPECTS  OF BUDGET, FII TAX  ISSUE OR THE ‘GAAR JOKE’ TO PULL THE MARKETS DOWN.. FOR APRIL MONTH , OPTION TRADERS MAY HOLD &  ACCUMULATE CALLS ON EVERY SLIDE OF MARKETS FOR GOOD GAINS.