Wednesday, June 17, 2009

Update for 17 Jun 09

The roles of the FIIs and DIIs seem to have reversed. And the FIIs sold worth 728.51 Cr and the DIIs bought 145 Cr worth. I am sure that that with this alone there was little reason why the markets ran up whatever that was worth. If not this then the next thing that comes to the mind is that the retail too joined in purchases and that held the markets to the levels they closed yesterday.Daily 16 Jun 09 The entire global markets had had a bad day a day before and Asia too took cues and was in red. Perhaps our reasoning was that after such a bad day for the entire set of markets the Europe will open green and then all will return to normal – business as usual. Well that may have been a fair presumption but Europe after opening flattish green went on to climb higher only to fall flat on its nose after the US showed no enthusiasm. Infact the plans of our market operators also seem to be thrown to the winds with the US markets drifting lower.

As far as the global cues were concerned the Asian markets yesterday were down red with Nikkei down 2.86%, Hang Seng down 1.8% and Strait Times down 1.23%. As I told some time back the Europe had opened flattish with green bias and went on to climb higher by the mid session – however at closing it once again turned flat with FTSE down 0.06%, Dax up 0.02% and CAC down by 0.17%. US too opened flat because of the mixed data on production and housing the markets dropped signalling end of the dream run that we have been having for some time now. Dow was down 1.25%, Nasdaq was down 1.11% and S&P was down 1.27%.

On the charts the candle was a hammer though the typical down trend had not set in so far. All the same it is a reversal signal from a down trend. With the appearance of the hammer a confirmatory signal the next day is almost compulsory.  We are near the middle of the Bollinger bands and also would have 3 EMA would have definitely crossed the 15 EMA lower had the candle been black. Volumes were just a bit better than a day before. ADX is bearish and the –DI had crossed above the +DI inspite of the white candle. MACD continues to show a negative divergence with divergence increasing – remains to be bearish. RSI tries to look up – and will see it today during the day. TRIX is looking down and shows bear times ahead of us. Slow Stochastic too are bearish. If we take a fall today then take yesterday’s climb as and aberration of misplaced enthusiasm of retail.

The Pivot data now…

R3 4669 against 4733 yesterday
R2 4618
R1 4567
Pivot 4468 against 4518 yesterday
S1 4435
S2 4354
S3 4303 against 4303 yesterday
Projected High Range 4527 to 4593
Projected Low Range 4481 to 4415
Fib Projected High 4572
Fib Projected Low 4369Put call ratio 16 Jun 09Option pain 16 Jun 09


See the Put call ratio that has almost equalised and the Option pain charts.