Easy Money

CNBC organized a meeting in the evening with Udayan as the Master of Ceremonies. I went to the meeting since I always like to listen to Udayan.

Rakesh Jhunjhunwala said he is bullish on the market. He expects the Nifty to remain in a trading range between 2750 and 4000 for the calender year 2009. He also expected a big rally before the elctions which could take the Nifty all the way to 3800 – 4000. He made the disclosure that he was long. He suggested that all positions should be closed on May 15, one day before the election results, for two weeks.

Now, 3060 to 3800 in six weeks is easy money.

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The Nifty is now in a trading range between 2980 and 3100. This range has lasted for five days. A breakout above 3100 could see 3220 or higher, while a breakdown below 2980 gives a target of 2860. The breakdown / breakout trade should be a high reward trade. All you need is patience!

Traders should go with market flow. With a clear, visible trading range, the short term trend is sideways. This means traders should sell at resistance and buy on some kind of support. If the Nifty were to breakout above 3150, then avoid selling.