Nifty & Bank Nifty Trading Strategy as on 23 May’13

Nifty as on 22 May’13– 6094.50 (-19.60)    Bank Nifty as on 22 May’13 – 13008.25 (-58.25)

From last three sessions, Nifty and Bank Nifty gradually moving lower. Common trait which I observed is, for sometime during an intraday, it gives a hope for reversal and just after some optimistic traders gets in long position, it reverses on downside, and give negative close.

Although last three sessions Candlestick patter is not 3 Falling Crows, but appearance is something similar to that. And if we see, onset of such a pattern warns of more moves to come in the same direction.

Momentum is also gradually moving lower, it follows the footsteps of price action.

Nifty Trading Strategy

In last session Nifty made a low of 6075 and finally settled at 6094. I sense today it will be crucial day. I would recommend traders to go short only if Nifty moves below 6070-6065, because everybody must be keeping strict watch on 6075 and from this level, there are high chance that Nifty makes a spike and reverses back.  Keep stop loss above 6105.  Below 6075 immediate target comes near 5975.

Bank Nifty Trading Strategy

In last session Bank Nifty made a low of 12932, which was a spike low and finally settled at 13008.25. I was expecting this and that is the reason I have mentioned in last article that, during an intraday volatility prices may spike towards this level. Anyways, still I maintain my view, It is advisable to go short in Bank Nifty only below 12950, or long above 13300 (chance are less).  After initiation, if prices move higher by more than 50 points, or in closing time does not close below 12950 than better to exit from position.

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