The Nifty gets a floor.

With two down days, on Monday and Tuesday, the Nifty found support just above 4900.  The Nifty is in some kind of a range between 4900 and 5100. This could mean a rally towards the 5100 resistance level. For swing traders, it is possible to buy sept calls with a stop below 4900. I continue to maintain short positions using October options. These positions will not be affected by the short term trend of the Nifty. For these day trades / swing trades I take positions in the September series.

Yesterday, Tuesday, Gold moved in a narrow range, suggesting a period of contraction. As I have explained in this blog many times, periods of contraction are followed by expansion. This narrow range is developing inside a small range with resistance at 28400 and support at 27500. These are levels for the swing trader.