Nifty for a trader in the month of March

• The January F&O series closed with upside of 11% and February with upside of 6.3%.
• Market showed gain of 22% from the low of 4588 on 2^nd January making a high of 5630 on 22^nd February.
• Nifty crossed the 200 DMA on 30^th Jan 12, after 3 failed attempts (07-July-11, 25-July-11 and 28-Oct-11) in last year.
• Considering the above factors, I believe the market has gained the momentum and it will remain so until it is above its 200 DMA which is now placed at 5172.
• As the rally in the Indexes have been large in these two months, we can expect some level of choppy-ness on the Monthly basis but, the intraday, intra-week volatility will remain higher.
• For trading in Nifty / Banknifty, a trader should approach a way of buying at dips and selling on rises rather than trading on break-outs.
• A Nifty trader can use any rise above 5600 for creating short and any fall below 5350 for creating long for the month.
• Stocks like TCS, HDFC BANK, LIC HOUSING, INDUSIND BANK and BATA INDIA which have been making new highs on QoQ basis even during last 4 years will continue to remain as best buys.
• Bigger opportunities are seen in the stocks which are rising from dust. A trader must approach such stocks with a clear-cut mindset that nothing is permanent, even the worst. DLF, Unitech and RCOM remains the hot bets in this segment.
• We would be seeing momentum building up even in the stocks which have not shown any momentum during last 3 years. We may witness momentum in TTML, MRPL and even MTNL.

As we see, in the daily chart, the nifty has been on the higher side of Bollinger band for more than 22 sessions and the momentum indicators like RSI, StockRSI, william% suggesting an over-bought zone.

But, important supports are placed at 5335 and 5260.