08/05/2012

If Greece drove the market lower at the open, the FM's GAAR clarification pulled the indices back above friday's close.

 

Nifty Mp 19 08/05/2012

 

Bn Mp 20 08/05/2012

 

At the close, the profiles were b shaped in both the BN and the NF with a close at the upper end which indicated that shorts closed their positions as the market started to rise.

 

The lack of a buying tail was evidence that there were no new buyers in the activity of today, just closure of shorts, which makes one believe that these would come back at higher levels.

 

From our post on friday :

 

Generally speaking the market after spending time away from a balance zone tends to come back and test the boundaries for unfinished business. This re-test of the lower zone around 5155-5165 should be part of your trading plans with care being taken to see that the markets stays below that trading range.

 

As the market comes to the lower end of this 1 month old trading range, the re test will have a lot of bearing for the coming sessions.

 

As mentioned if sellers do not appear near 5166, then 5212 is a certainty and above that we get a retest of the bracket highs closer to 5350/ 80.