Closing Review - Mar/19

All is well that ends well. That sums up the trading activity of markets today. Markets, taking cues from Asian counter parts, started with a gap. I was worried about closing of this gap at some point of time is required. And it happened in the opening hour it self. Sensex dropped to just cover the gap and bounced back like Kangaroo. By noon, it came to the levels of the opening high and never looked back. I guess there was disbelief in the market as it was rising all the day. Volumes clearly show that most of the people stayed away fearing this is just a pre-cursor to the next fall. Well, I could say as long as a bit of fear and skepticism around the markets, we are bound to go up. I doubt the rise when there is a huge volume and very high build up seen.

Nifty futures eased past the 3655, the previous high of Nifty futures achieved on Friday. A lot of short covering was seen as at some point time as the discount was as little as 5-6 points.

Going forward we are likely to test the sensex levels of 12735, 12820-12834 region being the 50% and 61.8% pullback levels for the fall 13155-12315. Nifty futures will target 3689-3695 region. On downside, 38.2% pullback for sensex is at 12523.

The one most important thing, I saw today was the activity in the entire tea sector stocks. Midcaps were freeze in upper circuits. I think traders have started playing sector by sector rotation game. If you are retailer, be careful in falling into the trap. They will completely move into another sector when you get in. This often happens at the beginning of bull market.