Estimates for 6th July

I'm almost certain that we will have an eventful day in the markets after three lackluster days of trading.

We have opened again within the 5231-5285 range mentioned yesterday.

The safest thing would be to wait for the range to resolve.

5253 would be the pivot around which a move to either side should materialize.

Further down 5196/ 5185 would have to be protected by the buyers.

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9.24

Buyers are showing their hand in the first 25 mins of action.

I'm buying the fut here at 5253 with a 20 point stop.Tgt 5285.

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10.10

There seems to be a problem with blogger, as comments are not coming through.

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10.21

I'm beginning to look at 5320 already today. Let's see the price-vol at 5285 first.

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10.54

Nifty is near the top end of the 5230-5285 range. The high so far has been 5275.

Suggest to book some profits here at 5273, as the auction can slow down. You can add if we take out 5288 with volumes.

Needless to say, the stop of the balance is at the pivot of the morning at cost.

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12.25

The auction has definitely slowed down in the past hour and half.

Some levels I am watching now in view of new information :

a) Auction below 5262 will be first sign that things are turning for sellers.
b) Auction below 5252 will confirm the same.
c) Auction above 5276 will mean bias moving up again.
d) Auction above 5288 means we are heading for 5320.

Trade accordingly.

Stops for morning longs can be brought to 5261.

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12.57

5285 done.

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13.12

I received an email from a reader. I'm reproducing it here :

Dear Shai,

I do not see you using macd's and stoc's in your charts. How can you be sure of the strength of moves without the use of these? I see every other analyst use something or the other, but on your charts I do not see anything.Can the market be traded without rsi, macd, stoc and moving averages?

Rajeev.


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Dear Rajeev,

I used to use all that you mentioned, some time back.Down the road, I started exploring options for leading indicators, which would put me a bit ahead of the move to unfold.I found that only price and volume would answer my queries.

I'm not dissuading anybody from using the macd, stoc, rsi etc. They are very good confirmatory indicators.Please use them to confirm your trades.But for direction, look at price on a chart and see how it moves with volume.

For the strength of moves, it again is price only.Let's say you use the floor pivots for your trading. If price moves from R1 to R2, would you say that the move is strong? The same can be said of S2 to S1 or pivot to R1.

I don't use pivots, but use market generated levels to qualify my trades.If the market moves from one of my levels to the next, I gauge the strength accordingly.

Rgds,

Shai.


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14.04

Those still holding longs, suggest to book out in the 5308-5316 range.

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14.40.

So we have had a good move today, about 80 points from the bottom at 5233 to 5312 so far.Does that mean that the trend has changed to up?

I'll say No, not yet. I still want to see that close above 5367 to get us out of the woods.

For tomorrow, I think we again have a side-ways to a slightly down move. It's important to see how sellers react then.

Sellers have kept quite near 5230 levels. I am sure they will show up again here and at 5344/ 5367 levels.

I'm signing off...see you guys later.

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