In Yesterday's Nifty View, 5425 was the resistance and 5370 was the support which was given for Nifty Spot. It opened right at the resistance zone, moved lower to break the lower support, and then fell till our final target of 5300 on the downside.
Today, Nifty has broken some very important supports and closed below it. Has the India story ended? Is this the end of the bull market? OR.... is it the end of the correction that is going on. Remember, in the markets, "When the Last Bull becomes a Bear, BUY." Buy has the last Bull really turned Bear or are there still some Bulls remaining? Answer to all the above questions is simple - Don't Bother! We are traders. Don't worry about what the market is Going to Do. Believe in what the market IS Doing. Believe on the screen. Trade all the breakouts and the breakdowns. Even with whipsaws, the ratio of success to failure will be much higher.
Coming back to our trading plan for tomorrow. The Options Open Interest table is given below:
The data shows big addition in 5400 CE, and simultaneous covering in 5400 PE. This level is the new battle ground between the Bulls and the Bears with almost equal open interest in the calls and the puts. On any revisit to the breakdown level of 5360-5370,keep an eye on the open interest in 5400 PE to get an idea of market direction. 5300 and below are the supports, while 5500 and above are the resistances, as suggested by the Options data.
For tomorrow, immediate resistance for Nifty spot comes at 5335-5340 levels, above which, it will try to attempt 5360-5385 and 5400 levels.On the downside,immediate support comes at 5285-5280 levels, below which it will slide towards 5260-5240 and lower. Trade cautiously.
9 Feb - Nifty spot resistance at 5335-5360-5385-5400. Support at 5280-5255-5240-5215 - www.niftypower.com
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