Following is my view of US S&P 500 Future and Indian Nifty Future based on various timeframe charts.
S&P 500 Future:
At the time of writing this post it is trading at 816 and there are still 3 hours left for US markets open. What I see is a stiff resistance here (823). After showing an upmove of nearly 22%, I think there are good chances that this resistance works. The market is overbought in the short to medium term and a correction looks a good possibility. However, the trend for short term is still bullish. Following are the points I have gathered for quick reference:
* Short term trend is bullish though there can be good resistance at 823.
* Primary Bear Trend continues and this latest rally is no indication of a change in Main Primary Trend.
* Resistance Levels - 823, 838, 855, 876.
* Support Levels - 799, 784, 749
* Below 749 bulls will be in danger.
Today was March series expiry and the way Nifty closed, many option writers must have got thrashed as as early as the start of this week the options OI data was pointing to a close near 2800. Now, one should be careful before we see April on our calendars as NAV prop-up efforts or the expectations of that could make things volatile.
Looking at various charts I have come to following conclusion:
- Today Nifty Future tried to peirce 3100 in last 30 minutes of trade but drifted down from there to 3064. As I have stated in my previous posts, 3140 is resistance area after it successfully conquered 2975.
- Short term trend is bullish but Primary Main Trend is still bearish. The kind of vertical rally we are witnessing is not any indication of threat to the Primary Main Trend.
- Resistance - 3140 - 80, 3268. If Nifty sustains above 3200 then Main Primary Trend itself can be in danger.
- Support - First immediate support is at 3008 - 29, then 2972, 2830 - 70 and last 2730 - 50. Breaking 2730 on closing basis will be end of this euphoria.