Friday, August 5, 2011

A powerful bearish day and markets likely to correct further





Markets closed below the crucial level of 5364 yesterday at 5332 after nearly testing the last support level indicating weakness and it is likely that markets will test further lower levels before any consolidation.

At the time of writing, SGX Nifty is trading around 5200 levels.

The OI and IV skew still favours bulls to a small extent and it is likely that markets will consolidate instead of cracking lower.

Increase in OI was seen in 5300 calls and unwinding in 5400 puts indicating markets might correct further yesteday.

Resistance levels : 5349, 5364, 5385

Support levels : 5294, 5269, 5194


-Happy Trading

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