Weekly Update: Markets nearing the intermediate peak ...

What the markets did last week ?
Markets defied gravity last week and closed strongly at a high of 5640 levels.

What does the options data indicate ?

Options data is indicating a huge open interest in 5600 calls and puts as well as 5700 calls and 5500 puts and 5400 puts. The call implied volatility was low when compared to the puts at 9.

What can be expected this week ?

The markets have already opened the week on a strong note and have made a high of 5724 levels. Most of the key levels are pointing to a fair value of 5680 for Nifty and any move above that is an over extension and is likely to correct itself.

How to trade for the week?

Though options data is not pointing to a major correction, Nifty could swing between 5544 and 5752. (5739 is a good level to short Nifty) and is unlikely to correct below 5544 levels for this series and is expected to bounce back to 5680 levels on any further correction.

Weekly resistance levels : 5680, 5721, 5739, 5752

Weekly support levels : 5631, 5605, 5560, 5544

-Happy Trading

www.tripleint.com

Performance Update for August 2010: A robust performance yielding strong returns !!

The picks are published under http://www.stockezy.com/picks/tripleint/

A total of 33 trades were generated in the month of August and with 1,00,000 as initial investment and a 2% money management based position sizing per trade has yielded robust returns of Rs. 30,360.65.

The same picks if traded under futures segment would have yielded a profit of approximately Rs. 89,412.50

Note: The calculation is without taking into consideration the cumulative amount gained and it is based on a flat 2% risk per trade based on the stop loss provided limiting the position size to the initial amount of Rs.100000 per trade. Increasing the risk % would increase the yield, but it is not advisable to go beyond the 2% risk per trade

For details refer to http://tinyurl.com/tripleint-performance-aug2010

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-Happy Trading

www.tripleint.com

A correction towards end of the session after testing new high...

Markets after swinging wildly towards the end of yesterday's session, closed above 5600 levels for the second time consecutively.

Options data saw some unwinding in near strike calls and 5500 puts, with 5600 puts adding 7 lakhs in open interest. The PCR cooled off a bit to 1.16.

Though the implied volatility of calls is much less than that of puts, there might be a correction towards 5544 levels, now that markets have hit the strong resistance level of 5631 before further moves.

Resistance levels : 5611, 5631

Support levels : 5580, 5544

-Happy Trading

www.tripleint.com

Markets to consolidate after reaching new high...

Nifty made a new high yesterday and tested the weekly resistance level of 5611 and closed above 5600 levels.

Options data saw heavy build up in 5400 puts and 5700 calls and some unwinding in all in the money calls of 5500, 5400.

The implied volatility of calls is low at 10 when compared to that of puts at 18 and this could signify another upmove before markets can correct further. PCR at 1.25 is still favouring the bulls. There might be consolidation around 5580 levels for some time before a strong move happens. 5544 is a key support level and markets can bounce back if that is tested.

Resistance levels : 5611, 5631

Support levels : 5580, 5544

-Happy Trading

www.tripleint.com

A strong close. Nifty to test higher levels before correction

Yesterday markets rallied strongly and closed at a new high of 5577 levels.

Options data saw heavy increase in 5600 and 5700 calls open interest and unwinding in 5500 calls. Heavy increase was also seen in 5500 puts and 5400 put OI continued to rise.

There might be a move to test 5611 levels and markets will face very strong resistance around 5631 and that would act as a strong ceiling for this series and market is expected to fall back into range

Resistance levels : 5587, 5611, 5631

Support levels : 5545, 5523, 5509

-Happy Trading

www.tripleint.com

Weekly Update: Another range bound week with wild swings

What the markets did last week ?

Last week it was written markets would move in a larger range but would be confined within with an increase in volatility and markets after testing a low of 5350 closed the week at 5479 levels.

What does the options data indicate ?

Options data has already seen a very strong increase in the open interest in all the near strike call and puts, with 5400 puts crossing over 1 crore much earlier in the series. Equal build up is seen in 5600 calls as well. The PCR has increased to 1.28, pointing to mild bullishness at the beginning of the week.

What can be expected this week ?

Overall it looks like markets will still be confined to a range, a larger one with volatility increase seen going forward. Any strong correction is likely to be neutralized by an equally strong up move and vice versa. Markets are likely to be confined between 5296 and 5611 for the week.

How to trade for the week?

The same strategy as that of last week to trade the range for the week with a buy at lower support levels and a sell at higher resistance levels.

Weekly resistance levels : 5531, 5587, 5611

Weekly support levels : 5444, 5352, 5296

-Happy Trading

www.tripleint.com

Consolidation tightens around 5500 levels

Markets consolidated yesterday after testing 5500 levels and closed the day at 5486.

Options data saw more of increase in all the near strike puts and calls. Overall 5400 put has the highest OI followed by 5600 call.

All the data points to a not so strong move on any one side and more of a consolidation around 5500 level for a while, with bulls and bears alternating.

Resistance levels : 5509, 5523, 5545

Support levels : 5462, 5445, 5430

-Happy Trading

www.tripleint.com

Strong bounce continues with added short cover ...

Yesterday markets after trapping the bulls at 5420 levels, raced ahead towards the end of the session, kicking in short covering and closed the day on a strong note at 5472 levels, above its 20 DMA of 5459.

Options data continued to see huge build up in 5400 puts which crossed the 1 crore mark very early in the series. Call side also saw an increase in 5500, 5600 and 5700 calls.

Markets have opened on a strong note and tested 5500 levels for the day. There might be consolidation around this level for some time before markets make the next move.

Resistance levels : 5485, 5509, 5523

Support levels : 5445, 5430, 5418

-Happy Trading

www.tripleint.com

Strong bounce came in after testing crucial support

Yesterday markets tested further support at 5350 levels and then gave a strong bounce towards the close back above 5400 levels and the effect of that is continuing at open today.

Options data saw heavy increase in 5300 puts. The PCR is not heavily biased and is at 1.15.

So any bullish move now towards higher levels will be neutralized by bears going forward. Market is moving in a bigger range as mentioned in http://tinyurl.com/2wacyq3

There is also a possibility of markets to test momentarily further support of 5296 before giving another strong bounce and as of now will face stiff resistance at 5459 levels.

Resistance levels : 5430, 5445, 5459

Support levels : 5380, 5373, 5352

-Happy Trading

www.tripleint.com