iCharts Discussions

[ajayhkaul]

[rk_a2003]

After the decision of railway fare hike complete reversal excluding 2nd and 1st A.C fares the market appears to be tanked.Only partial roll back is expected.Are FII's unhappy with complete roll back? and might be concerned about one more potential contributer to fiscal deficit.Which ever is good for common man is bad for Institutions

[ajayhkaul]

Or did this have something to do with March 31 approaching (financial year end) ?

The Vix had been sliding for over a week even as market was heading lower.

[vinay28]

Market tanked because of variety of bad news from china and europe coupled with fall in INR. Why the latter?

[psalm]

We had a huge sell off today. India VIX has gone up by a whopping 15% or so. Looking at the U.S. and the European markets, they are trading considerably down at the time of this post. Looking at the domestic issues, one can see that scams have taken the center stage again. Development takes backseat as the populist measures or petty politics are in the limelight. Is it a doom scenario now? Is this liquidity driven rally over? Are the bears ready to take over the hot-seat? Will there be another sell off tomorrow???

Things are looking pretty bad at the moment. There is no doubt about that. But not everything has been lost as far as the bulls are concerned. There are still some bright spots left as far as the technicals are concerned. I'm trying to project the positives here. It doesn't mean that I'm very bullish now. I'm neither bullish nor bearish now, at least for the short to medium term. However, I must confess that my long-term bias is slightly bullish. I have posted the India VIX charts below. Both on a closing basis and also intraday basis. The next 2 charts I have posted are Nifty daily charts, both on a closing basis and intraday basis.

Long term VIX chart shows that the index is converging (triangle) and that a break-out or break-down is imminent in the near future. Looking at the daily VIX charts given below, one can see that VIX has bounced back after hitting support of around 21 levels. But I'm urging you to look again at the chart carefully. Is the VIX forming a Head and Shoulder pattern there? If so, today's move has almost brought the VIX to the neckline. That means, there won't be a huge up-move tomorrow, at least on a closing basis. What next, if the upside is limited??? One can imagine the VIX coming down soon, which might be good for the up-trend. If everything goes according to the plan, there is chance of VIX testing 14 levels (I don't know if it will happen) soon. In normal case, that's very much a bullish scenario.

TIP: Tomorrow, VIX has resistance around 25.5-26 range. However, if broken 26 levels convincingly, one can expect the volatility index to test 28/29 levels.

NOTE: VIX analysis includes short to medium term implications.


I have also, provided Nifty charts as well. The images themselves are self explanatory. Some indications suggests weakness. However, one can see bright spots even in this gloomy scenario.

NOTE: Nifty Analysis is only for a day or two (mainly for tomorrow). It doesn't have any long term implications.

[psalm]

[vinay28]

[ajayhkaul]

The rupee is now less than 2% away from its lowest point in a decade, of 52.18 rupees hit in early March 2009 when global stocks hit bottom in the wake of the 2008 financial crisis.

Over to RK

[ajayhkaul]

psalm thanks for the detailed analysis.

VIX as an indicator is most effective at the extremes.

It will be interesting to see if high volatility is followed by low volatility on friday.

[vinay28]

ajay, didn't rupee go to 54?

[sairanga19]

nifty taken support at 200sma on 7th march and rallied upto 5542 but cud not make new high so this time 200sma unlikely to provide support ,slide may continue

[ajayhkaul]

[ajayhkaul]

[rk_a2003]

[rk_a2003]

It seems Reliance buy back is kicking in at 740. If it holds expect a recovery in the coming day's.