Another $800bn life-support for the US financial system & Rate cut by China has improved the market sentiments.

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Dear Subscribers,
Our reco on Wed turned out to be wrong due to sudden rate cut by China which helped in improving sentiments in the south asian reason. Metal stocks rises and people started expecting similar move by RBI.
A slight change in the sentiments lead to SHORT Covering which helped Nifty move upward ~3%. For a very short term we have changed the strategy and would request you to refer the one mentioned in the mail below.

Market Update:-
The markets had witnessed good amount of volatility in the morning session but picked up pace in the afternoon session on the back of positive cues from the Asian markets and closed for the session in green with Sensex above the psychological level of 9,000.

The major cue from the Asian front was the rate cut announced by the Central Bank of China raising expectation of a rate cut by the Reserve Bank of India which accelerated the pace in banking stocks. The Nifty November futures contract is getting expired tomorrow and the rollover figures is at 47% which is poor showing the investors are less interested to carry over their positions to the coming month.

National Stock Exchange's Nifty ended at 2750.45, up 96.45 points or 3.63 per cent. The Nifty recovered sharply from the support level of 2,650 to close the day at 2,752 due to short-covering in Nifty and stock futures ahead of expiry of the November series.

HBJ Capital's Views for Thursday:-
If we look at the global picture, Wall Street extended its gains into a fourth session Wednesday, rising moderately after President-elect Obama soothed investors by pledging he would have a plan to deal with the nation's economic crisis on his first day in office.

Traders were also cautious ahead of what is essentially an extended Thanksgiving holiday weekend; the market is closed Thursday and will have an abbreviated session Friday.There is some type very short term change in the sentiment seen in the global equity market participants who are helping US market to slowly move higher, considering this one can't rule out positive sentiment back home.

1. As of now Nifty is trading around 2750; Indian markets are expected to open flat or with small gain on Thursday. If you are holding SHORT position on Nifty futures you should exit if market goes above 2800; as long as market remains below 2800 level be invested.
2. After crossing 2800 level Nifty can go higher and there is resistance at 2900 level only; so you can consider going LONG on Nifty future if above 2800 level. In case if you are already holding LONG position on Nifty then just stay invested with stop loss below 2700 level.
3. Below 2650, Nifty will continue to fall, so take SHORT position only below 2700 or 2650 level. Pls do not trade in Nov Option today. After expiry one can take position in Dec Options at reasonable prices level.

Regards,

Sandeep Jain, Associate, HBJ Capital.
Pls read this daily before trading: HBJ Capital’s 5 golden rules for profitable trading.