View on Nifty and Bank Nifty

Nifty as on 12/04/2013 – 5528.55

Bank Nifty as on 12/04/2013 – 11410.10

Last week I was expecting Nifty to test 5445-5400 levels, but it tested 5477 levels, and then traded in a choppy manner, where many full proof trading strategies failed, which were well acknowledged and traded. Anyways it is the part and parcel, you cannot expect 100 out of 100, if you are, then you fooling yourself. On above I have lot to say but topic will get divert.

Coming to markets. Broadly speaking market is in midst of indecision, where both parties are really struggling to drive the market. I sense Nifty should take U turn in coming days, as most of the stocks are showing initial signs of recovery, Bank Nifty and its components are showing some early positive reversal signal, only spoil sport is CNX IT index which was moving as per expectation.

So, Nifty on staying above 5400 level are likely to stay on a positive note.

Trading Strategy –

As markets are giving early signs of reversal and there is no solid confirmation. In such scenario trader should opt for options. I expect Nifty to trade with positive bias, so Buy the Call options, where risk is limited and profit potential is unlimited. Traders can apply similar strategy on Bank Nifty as well.  I am not recommending any strike price here, as I keep it open.

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