Dated :- 12. 10. 2014

                                                                    NIFTY SPOT : 7859.95

Hi,

Readers,

As mentioned earlier in my earlier blog dated Oct 08, 2014 that Nifty will be trading very volatile. Nifty remained choppy, up 120 points one day and down 100 points next day.

It was mentioned in my previous blog that if Nifty again closes below 7930, that will be the first indication that Nifty’s 120 point up move on Oct 09, 2014 was merely a short covering and it is not getting any follow through. And in that case more downside will open in Nifty.

Nifty closed below 7930, thus indicating that it has more downside till the time it is below 7960. That was the time to create short positions again. For downside to open, the ideal situation is that Nifty should breach 7800 level within next 2-3 trading sessions. If Nifty do not breach 7800 within next 2- 3 trading sessions then short positions should be closed and step aside.  

Because in that case, Nifty will be in a range of 7800 to 7960. Breakout on either side will again give trading opportunities.

On the other hand if Nifty manages to close above 7960 again, that will indicate that 7800 level is holding once again and Nifty is inclined to go higher. In that case even long positions would be justified for high risk traders.

It is expected that we may have another truncated week with elections in Maharashtra on Wednesday, it may be a holiday on Wednesday (depending upon the authorities). Next week will be news heavy, inflation numbers and opinion polls numbers will have their impact on markets.