We are expecting the market to open a gap down of 5 – 8 points in accordance with the triple digit lost in the US market last night and the further dropped in the Dow futures at the point of writing. The important support for the cash and futures at 1328 level may not able to hold at the opening, however, investors can closely monitor on the intraday development and taking this opportunity to take a long position if the cash manage to recoup the losses during the day and regain its status above the 1328 level.
In our view, for risk averse investors, any level today near/ below 1320 level should serve as a good level to initiate a long position. Reason for doing this --- We are still in the view that the 1320 level for both the cash and futures will able to hold the market, thus with limited downside and more upside, investors should find it worthwhile to take this chances. However, we reiterate:-
1) Setting stop loss point is very important and we are suggesting the stop loss level should be around the 1316 – 1313 levels.
2) For risk averse investors, capturing on intraday trading will be wise and try not to carry position overnight in view of the current volatile world markets.
Support for today is seen at 1325 – 1320 levels and the resistance is seen at 1335 level.
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