Posted By : Kishore B.S
The global markets were in red yesterday which led to a gap down opening in the Indian markets today. But Nifty recovered very sharply in the late afternoon trade due to the warning of Tsunami issued in 28 countries. No major disaster has been reported so hope that everything is safe.
Now the European markets are trading in positive today and US markets are also pointing towards a positive opening. Yesterday S&P broke a strong level today. Like I said yesterday the market is in a down trend forming lower highs. The trend is continuing and tomorrow we expect a a rally to 5300-5350. Now, tomorrow we are having IIP data which will guide the market direction after the initial positive opening.
Now one should not expect a huge rally. There will be modest rallies and one should exit all long positions around 5300. The Chinese data to be released on Friday will also give market a direction. The market did very well in taking support at 5200. This shows there is strength in the market and it won’t break 5180-5200 very easily. Now the range is getting narrowed on the upside. Its now 5180-5320. So, the next time there is a rally it should be sold into and no new long positions should be initiated. If no natural disaster happens the markets are expected to have a relief rally tomorrow.
(Inputs Mr. Shubham Deva, An Stock Market Institute Associate, IIT Kanpur)