Today Nifty Future made a new high, that too post RBI policy announcement but gave up all the gains by the end of the day, to leave EOD candle as a Shooting Star - suggesting bearishness below today's low of 5826.
Coming to the tomorrow's market movement, I continue to believe that the risk reward ratio for fresh long positions is a quite adverse and hence it is best avoided. For tomorrow, if market trades below 5800, one can go short with stop loss of 5830. Alternatively, if market pulls back up to 5885, one can go short with stop loss of 5920 (though looks unlikely). On the down side it will find support at 5750-5725 levels and try to bounce back - in view of Trend Line support on the EOD chart. Once this trend line is broken, one need not rush to square up the short positions but would do well to trail it with stop loss.
Tomorrow being the last trading day of the week any close below 5750 should be considered bad for the next week.Coming to the tomorrow's market movement, I continue to believe that the risk reward ratio for fresh long positions is a quite adverse and hence it is best avoided. For tomorrow, if market trades below 5800, one can go short with stop loss of 5830. Alternatively, if market pulls back up to 5885, one can go short with stop loss of 5920 (though looks unlikely). On the down side it will find support at 5750-5725 levels and try to bounce back - in view of Trend Line support on the EOD chart. Once this trend line is broken, one need not rush to square up the short positions but would do well to trail it with stop loss.
All the best
