Nifty View for 02.02.2012

Nifty has made a new high of this swing at 5244.60 and closed at 5235.70.In this rally the corrections have been minimal compared to the rise.Now if we look at the big picture from top of Nov 2010 we have retraced upto the 38.2% level which is significant.The recovery can be termed as weak.For the recovery to be normal we need to reach the 50% level at 5433 on the spot nifty.Whenever an important fibo level is reached there is natural resistance at that level.So some consolidation is expected at the level of 38.2% with the base being at 23.6% level of 4954.Now do not rush to short the nifty for target of 4954 when I say that.It is expected to consolidated between those two levels.On break above the 38.2% levels we may try to reach the 50% level of 5433.So keep both the options open.On 30.01.2012 I had mentioned to open positional buy call above 5240 with stop loss of 5220.So we are long at 5240 with the stop loss of 5220 positionally.The swings can be both ways at this level as we are important fibo level.The positional entry needs to be monitored vigilantly for the stop loss and entry level even if it is hit many times for safety of capital.I would reiterate we are in a turbulent phase astrologically where we need to be cautious and keeping intraday view will be beneficial .Try to book profits as and when they come and try to come out with small losses after the stop losses are being hit.Above 5240 we may try to reach the level of 5315 on the spot nifty.Intraday traders can look at the levels on spot nifty given below to trade on 02.02.2012.

Spot Nifty levels for intra-day trade on 02.02.2012
No trade between 5218 and 5254(to avoid whipsaws)
Buy above 5254 with SL of 5234 
for targets of 5272-5290(breakout  level on the upside,add positions) 5308-5326-5345-5363-5381-5400.

Sell below 5234 with SL of 5254 
for targets of 5200-5181(breakdown level on downside, add positions)-5164 -5145-5128- 5110- 5092-5074.

Happy Trading !