Nifty Futures trade plan 20 - 12 - 2010

On thursday nifty formed a balance area at the bottom and broke above VA. However VA was declining for the last 3 days. There is a small buying tail.

Expect Nifty to trade higher today. Two trade plans are marked in chart below.

1. Opens near previous close and tests VAH 5953.80 and rises. In this case buy at 5954 with SL below 5943. But if a well defined VA is developed above and nifty comes to this reference point, do not buy.

2. Opens wthin Value area 2 or comes into Value Area 2 at open (wthin the first minute of open), then buy at POC 5928 or at VAL 5923.60 with SL of 11 points. But if a well defined VA is developed above and nifty comes to this reference point, do not buy.

3. Nifty opens within Value Area 2 and tests VAH 5953.8 sell at 5954 with SL 11 points. If the SL is hit and nifty goes up buy at SL point 5965 or on a retest of 5954 level.

Prefered trade ideas are 1 and 2. trade plan 3 needs discretion to execute.

And the Targets ! You need a minimum risk rewards of 1:2. Take more profits if you can.

Ok, What if the market opens higher or trades higher without trigering a long opportunity discussed above.

See Chart below. SL same 11 points.