Nifty Technical View
Its been a very surprising time period in terms of how quickly Nifty is shuttling from overbought to oversold.
As of yesterday Nifty has touched oversold levels on RSI similar to previous bottoms.
Although Nifty broke recent bottoms of 5580 there was not much of panic selling in index weights. ( The reasons for the same is how skewed the index is on few stocks ) Check this detailed post written in this week.
Will we again see a pullback because of the oversold conditions. Seems probable but given that only a few stocks can lead the bounce it is imperative one now keeps a stock specific view.
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August 7, 2013
You have been right the last few times when had pointed out oversold levels. But i wonder is this time different. This time the Nifty Future still has a 30 point premium over the Nifty Spot.
August 8, 2013
Ramesh, the 30 point premium is actually under fair value. Fair value for futures is very dependent on interest rates and the given the recent spike in short term rates the fair value for futures has increased.