For the coming week, a decisive move may happen only on a break of 2775 - 3050.
The oversold Nifty after some positive divergences in the 5-Min charts bounced off the the critical 2800 levels. Most of the day's action was centered around the 50 DMA (2866) and bulls managed to stay above that.
Trade light in the 2775 - 3050 area till a decisive move takes place and trade strongly in the direction of the break out with SL as Markets are highly unpredictable with myriad corrective possibilities.
Important notes1) Trading system Is useful for positional traders and short term traders.
2) It is not useful for day traders.
3) If buy call is generated then keep stoploss of 3d LMA.(reduction of 50 % is advisable if closes below 3d SMA).
4) If short call is generated then keep stoploss of 3d HMA.(reduction of 50 % is advisable if closes above 3d SMA).
5) Investors should buy nifty at the money puts whenever short call is generated in nifty to protect there portfolio.
6) Keep an eye on weekly close, as in a generated long call gives better returns if we are trading above weekly close, reverse is true for short call.
Many friends visiting here have been asking me for my views on the path ahead..(also for CHRIS & all FRIENDS from MJ)..The above chart is self explanatory, I have posted the fibbo speedlines/channels etc ...Area to watch will be 2800 zone ,break and close below it. takes us to 2500 around...Below 2500 is free fall.. above 3240,we can go all the way to 3500.....enjoy the weekend..cheers..
Sensex lost 551.75 points or 5.54% to 9,406.47 and Nifty slipped 173.75 points or 5.70% to 2873 in the week ended 9/1/2009. Last week Satyam scam break positive sentiment of market and pulled down into negative trend. The sentiment may remain nervous with investor confidence shattered by a massive over Rs 7000 crore accounting scam at IT major Satyam. The accounting scandal has created shock and fear among the Indian and global investing community.
The third quarter December 2008 results will dictate the near term trend of the market. Market expects poor the Q3 December 2008 earnings from Indian Inc on high input costs, the credit crunch and high interest rates, coupled with the burden of piled-up inventories.
Inflation has been on a sustained fall since peaking at a 16-year high of 12.91% in the week to 2 August 2008, raising hopes of further softening of interest rates from the Reserve Bank of India. Wholesale Price Index (WPI) based inflation rate fell to a 10-month low of 5.91% in the week ended 27 December 2008 from 6.38% in the previous week.
Use Stop loss strictly in your every trade, because market is heavily volatile with narrow trading range.
| INDEX | THIS WEEK CLOSE | PREVIOUS WEEK CLOSE 2-1-09 | PERCENTAGE CHANGE (%) |
| SENSEX | 9406.47 | 9958.22 | -5.54 |
| 2873.00 | 3046.75 | -5.70 |
NIFTY FUTURE CHART
NIFTY FUT. (2863):
As per our last week’s prediction, nifty had a very strong resistance of 3120, in last week nifty could not close above 3120 level for single day. Now, weekly chart shows bearish engulfing in nifty. Major Resistance is 3120 and Major support is 2800, Buy nifty if close above 2890 for target of 2976-3017-3066, below 2800 nifty may touch 2701-2650-2565.
BAJAJAUTO(427.70)
Buy this stock only above 435 for target of 443-455-470, keep stop loss of 410.
SUNPHARMA(1099)
On chart this stock made bullish engulfing, so buy above 1110 for target of 1132-1150. keep stop loss of 1083.
CHAMBAL FERTI(35.65)
On chart this showing double bottom, looking to that support buy this stock above 36 with stop loss of 33. Target is 39-41 to 44
JPASSOCIATE(68.50)
Buy this stock only above 77 for target of 85-93. keep stop loss of 63.
This “CHANGE” in the paradigm to explore quality stocks may bring volatility and relaying on MNC stocks will emerge apart from supporting the proven established Corporate Houses. The quality IT stocks may get more business and the promoter worthiness will bring business and valuation as premium.
The Nifty is at the cross roads as it could face the slaughtering by Bears with various rumors. The Nifty fell from 3150 level to 2810 level due to Satyam fiasco and doubting the other published high rise accounts. The Nifty has to cross 2950 level to mitigate the damage done. The bottom fishing is good for MNC stocks to get advantage of a feel good factors circulating as if they are more sagacious and unadulterated.
The RIL is very weak and good above 1221-23 level but bundled with resistance points as scales up, immediate major resistance at 1245-51 level. The ONGC is good above 695-97 level but has support at 646-51level The ICICI bank has no tags attached to this Satyam tale but the exposure to credit cards and advances were not disclosed yet. The stock enjoys criticism and controversies corner it now and then is good above 485 level but the resistance may come at 497-98 level. Incase the low breaches 434 and close below 439 then it will face the blistered Bear beating. The SBI is good above 1275 and weak below 1240 level. The Relcap is good above 528-36 level as the Nifty inclusion is w.e.f-12th Jan.
The sudden weakness a head of this mess saved Bharti bounced back to 640 level from 610 region to save Nifty could find buyers above 658-661 level other wise the story is no different. The RCOM is good above 208 and weak bellow 195.
The DLF signals to all Bears are clear as the Buy back corned them could save if it trades above 205-203 level and the ardent Bears sell below 195. The FII are exiting the infra and construction stocks may weaken the market and it will hurt the sentiment.
There is every possibility that the GOI may come with more stringent Corporate Governance laws and powers to Independent Directors along with responsibilities.
An article in the Business-Standard covered as……
Merrill, IL&FS sold shares in nick of time
BS Reporter / Mumbai January 11, 2009, 0:41 IST
Days before B Ramalinga Raju admitted to fraud, a handful of financial
services companies, including DSP Merrill Lynch, IL&FS Financial Services
and Deutsche Bank’s non-banking finance company, sold Satyam Computer Services
shares pledged with them. IL&FS Trust Company, which was warehousing them on behalf of the lenders, permitted the lenders to sell the shares.
According to information available from the National Stock Exchange, IL&FS Trust
Company sold 14.89 million shares between December 24 and January 2. On December 24, 2008, IL&FS Trust Company permitted sale of 6.05 million shares at Rs 120.09 each, while another 4.41 million shares were sold at Rs 139.83 five days
later. The trust let go of a further 4.43 million shares at Rs 176 on January 2,
2009 – five days before Raju’s revelations……………………
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