Home > NIFTY Strategy > Where is this market headed?

Where is this market headed?

Wednesday, February 27, 2008 Leave a comment Go to comments

This market is actually heading nowhere. It is strictly trading in a range of 5050 to 5350-5400. Large commitments are still absent. It might be because of a big event like “budget”.

So how should one play this market? Simple- Go long around 5050 levels and sell out or go short around 5400 levels . So far it is working out perfectly. Even stocks are moving in specified ranges. Take suzlon for example- the stock is trading between a range of 295-345. I have myself traded the stock couple of times in this range.

So what does a range tell us? It tells us that it is a “wait and watch” situation for most of the market players. If we break out of this range on the upside, we might see 5800-6000 on the index. At the same time if we break on the lower side,we can see 4500 again.

At the same time, I’d put the probability of this market moving higher than lower as 60/40. This is primarily on the basis of “fear/gloom” surrounding us.

These are good times for short term traders and challenging times for “buy and hold” investor. Thats why one needs to adapt the style according to market conditions.

Categories: NIFTY Strategy
  1. sagecapital
    Sunday, March 2, 2008 at 7:33 pm

    Rey- I am not sure about 4000 but 4500 looks very likely if we we break through 5050.
    Infact many stocks in the Reliance family(ADAG) look poised for some steep falls!
    Pharma and to some extent steel are the only sectors showing some resilience.

  2. ReyMax
    Sunday, March 2, 2008 at 1:00 am

    Most of the time, you have such compelling and well thought out approach that i just hv to agree with it. However, I also love to disagree with you – whenever occasion arises. Here I disagree.

    Market started travelling south after 8th Jan and showed the vicious stuff it is made up of on 21st and 22nd of Jan. The correction (or crash) was not, and is not over. Mkt hung in limbo over the next 25 trading days, hoping that budget might give some reasons for it to go up. Budget has come and gone and has nothing to offer the market xcpt few small negatives.

    Come Monday, and FIIs will pretend that they dont like the budget for so and so reasons (all baloney) and pull out the money. The market wii resume southward journey from Monday, and because of pentup pressures of holding on during limbo, Monday should be big down day seeing huge sell-offs, lower circuits etc and Nifty down 500 points.

    Coming week will be the final week of learning for the longs and sheer pleasure for the shorts.

    NIFTY 4000 is only 5 days away.


  3. sagecapital
    Wednesday, February 27, 2008 at 1:18 pm

    I have not traded the stock but I have it from 70 levels. One of those rare stocks which is hitting new highs! This is again a commodity play on coke/coal.

  4. ashish ji
    Wednesday, February 27, 2008 at 9:30 am

    are u playing GUJNRECOKE? since 21ST JAN IT RISE AROUND 50 percent ….

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