04 SEP 2008

Today is the Inflation day (after market). 

Inspite of the fall in Crude prices, I am also aware of the slowing growth signals from around the world; and in the absence of any positive signals in the last two days, we may not just keep going up and up without any hiccups. Yet, in the event of a slide down, we should halt above the Supports given below. The massive move on Tuesday seems to have turned things positive, at least for the short term and levels above 16500 (Nifty 5000) could be eyed upon by mid october, hopefully!

I would keep holding my existing long positions (30%) initiated at 4200 levels last Thursday, and also the INFOSYS Call option of strike 1800 initiated as per the recommendation last Tuesday. I would also buy (October series) 10%  on declines at 4360 levels and then 10% more at 4200 levels with a final stop at 4100. 

So, the revised levels would now be:-

New Resistance 4650

Immediate support 4400

Strong support and reversal point 4360(buy 10%)

Support 4200(buy another 10%)

Final Stop loss 4100.

Crude Oil has broken its crucial support at $110. Now the level of $100 would be watched keenly. The focus now has shifted to US economic data and US Dollar(USD) strength. 

USD is watched against Euro(EUR) and Japanese Yen (JPY). USD will gain further if the crucial support at 1.43 is broken against EUR. 

Gold is also weakening and may go down to $700 in long term. Medium term support is at $770. 

(We have included US economic calendar at the bottom of every page; Gold and currency charts (expandable) are on the sidebar for your convenience).

Wishing you a happy trading day!