A make or break day for market....June 09, 2008

Today is a very interesting day in the market. It is so difficult to predict what will happen now. We have very bad global cues to start with. This means market could very well open low and test the supports around 4500. We have two important supports for this market on the lowerside at 4530 - 4540 and lastly 4440. Now these need to be held for any bullish case. There are 2 possibilities here

1. Market bounces off the given supports. In which case, we could have rallies upto 4800+ levels.
2. Market breaks the supports given. This can be disastrous for market as we will go down to 4000 and probably even 3600 then.

Based on FnO data, the indicators are that of a bounce from these levels and not a break. Also, now that the entire mass is bearish, market could very well show who is the king and move in the opposite direction. Again all these are possibilities and this time I do not wish to speculate too much which side it will go and take positions in advance. So today again we will be on the sidelines and see where it is headed. My guess is, it will bounce.

The very small long positions built on friday, (I have a 4700 call only one lot) can be held as long as these supports are held on a closing basis. If there is a good bounce today off supports, then this week we could have a good rally. I haven't posted a chart today as there aren't too many changes as such.