Nifty & Bank Nifty Trading Strategy as on 21 May’13

Nifty as on 20 May’13– 6156.90 (-30.40)        Bank Nifty as on 20 May’13 – 13181.50 (-135.60)

During first half market remained with positive bias, after which started away giving gains. Nifty posted a high of 6229.45, and Bank Nifty 13414.30.

As market witness any dips, bear camp will come ahead and say “Look, its reversal sign” and bull camp will defend move as just a cool-off and retracing the prior move. Whenever prices reaches near crucial top this obvious scenario emerges, and let me tell for any trader it is very tough time, because now they are really confused about taking decision.

In our weekly analysis, we have clearly discussed all pros and cons about the market, and where we stand. By yesterday’s move, you can’t announce that market has formed top and go short (don’t try to become God).

Nifty Trading Strategy

I think Longs should be initiated only above 6200 level and for Shorts 6100-6085 levels. Trader should look for breakout and keep trailing stop losses. As I always feel that, even small profit, will give you more confidence than losing trades.

Bank Nifty Trading Strategy

Bank Nifty is in different state of mind compare to Nifty. On last Friday it already tested life time high and settled slightly above it, but immediately on next day i.e. yesterday (Monday) prices witnessed rejection from higher level, which indicates profit booking pressure. Now, we have to see whether it is just profit booking or fresh shorts are added into this. We’ll come to know about this by today, how it reacts.

Long in Bank Nifty can be taken above 13300 with stop below 12950, or Shorts can be taken below 12950. Don’t jump into trade, as market will give ample opportunity to earn, so follow systematic way.

You can always ask your queries in Way To Profits.

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