NEWSLETTER

(NOORESH)

Sensex Technical View :

Sensex surprises big time and has done our tgts of 12900/14500 (almost done tom ) which was supposed to be a 10-14 mths or earlier but not 2 months.

Technically the entire retracement levels of the last fall from 21200 to 7700 comes to 14500/16k corresponding to 50/61.8% fibonacci levels. So ideally one would expect a major top for short term be seen in this zone.Previous top of the last leg comes to around 15580.

Similar levels for Nifty comes to 4650 prev top and 4800 as 61.8% retracement. Taking into account these levels we would expect a maximum cap for the rally at 15.5k-16k and 4650/4800.

Investors should be highly cautious and book out of large caps and over run stocks at least to the extent of 50-60% when index starts moving above 14700Sensex /4500 Nifty or even earlier.

The next round of opportunity lies in the MID CAP AND SMALL CAP SEGMENT as the broader market has still not rallied enough or participated .

Many stocks discussed here have moved up considerably continue to be disciplined and book profits on 25% gains to reduce avg cost for long term holding.

Stocks to watchout for :

Investors can look to enter following stocks which have not participated in the rally by shifting from ove run stocks. Will look for short term picks after stability this week.

Dishman Pharma

Aurion Pro ( lil risky )

IFGL refractories

Patel Int logistics /Kirloskar Oil

Agro Tech Foods.

Time Techno.

Do your own research before selecting the stocks.Partial around 30-40% can be taken at current price and then add on dips.

(NOORESH)

Sensex has made a historic move today with a triple circuit by closing almost 2100 points up.

First time ever trading was halted for a whole day because of an up move of more then the specified circuit limit levels based on quarterly closing which is at 975/1460/1950 + respectively. Sensex ended up 2110 points up.

The upmove has really surprised everyone of the street including me but for us its been a pleasant surprise as have been on stock specific longs and more the merrier.

Many would be creditting this move to the LEFT OUT feeling but data suggests it might be a SHORT OUT system issue which can be a lil serious.

Lets go through certain statistical facts and observations:

-- > All previous Sensex /Nifty circuits were down circuits aided by margin selling or external news. Volumes were always equal or more then the 2 week average qty. We never saw it hit the circuit limit 3rd time.

-- > This is the fastest time in which markets hit a circuit since the down circuit on p-note issue but it recovered by end of day. Total trading time was less then 2 minutes in the double halt today.

--- > Generally circuits are seen mainly due to either margin selling or an external event impact. P-note , Sub prime Dow Jones , Elections were numerous issues.

--- > The current up-move can be attributed to short covering and one of the most disturbing fact is the entire move on NSE has been through only 3000 crores. This implies the amount of shorts in the system have still not been covered and will be left scrambling to do the same tomorrow.

--- > In todays rise was so quick in seconds that BSE/NSE systems failed to put a freeze on the 1st circuit limit and the indices inched up to the 15% limit. Indices got a 2 hour halt together.

-- > As per derivatives data and market-men there is a huge amount of short build-up in Nifty futures and Calls of 3800 to 4200 series in Nifty have been written heavily. Some of this might be hedging and strategy positions which need to be covered desperately. Lot many brokers are into margin issues from clients with short positions. Will it be opposite of the MARGIN SELLING in earlier falls and we would see MARGIN BUYING in derivatives. Will not attribute any further buying to left out feeling. All in all the huge shorts still in the system and need to be covered for some normalcy in the index.

-- > Statistically its a classical short squeeze as SHORTS as even after a 17 % move the huge shorts in the system have got no chance to cover. Panic Buying by FII Hedge Funds , HNIs and other participants would be seen in the opening bell.

-- > As per statistics Domestic institutional investors /MFs and mainly Insurance companies have been the big buyers whereas FIIs were left out. Hope to see LIC and others coming out to sell to bring normalcy in the market.

-- > If this doesnt happen MARGIN BUYING by brokers , Panic buying by FIIs /MFs to increase allocations can wreck havoc in the system on opening bell. Hope SEBI and Exchanges need not intervene with differential ckt limits or time halts.

Somehow all this points to a safe booking route for investors who bought at lower levels. 14.5k/15.8k levels are one of the best to get out of over-run stocks book half or more of holdings.

ss

Thanks to today's gap up, the 5 day ATR shoots up to 238 (5.5%) and the 20 day ATR is at 147 (3.4%)

ss

No doubt! This is the mother of all gap ups! Jesus Christ! Today's high is 2 point less than the January 22, 2008 low of 4420.

(Inder Bhatia)

The Indian market made history 2upper circuits it was golden Monday on dalal street .For coming session we open gapup and test 4500 but we can see profit booking at higher level around afternoon session .On the lower side 3700-3800 zone will act as strong support zone.

Rajeev DesaiHat off to Bulls.............I have no words other then this to describe this annihilation of bears by Bulls. This upper circuit must have brought many heart attacks for shortsellers.
Heard that Shankar Sharma was in good mood even though market went up.Someone asked me why he was not perturbed.I told me he must have no short position and must have misguiding people from wire media to short but he was not.That is a glaring example of how big heads make fool of investor.
I also heard that one of the most respected person and a veteran in market who use to recomend stock on fundamentals also shorted market and was sure that the verdict will not be so good and we are still in bear market , didn't cut the short position on Friday expecting fractured verdict.Seems he must have made a Huge Loss...........as NIFTY UP BY 650 POINTS....
is not a greart scenario for shorters.650 points in a day for Nifty is HUGE.....
Bulls were moulded and grinded to dust for 12 months for entire 2008 and Bulls picked up the great occasion and left no way to leave bear any respite for an inch.
When I talk of Bulls I have only one name in my mind and that is .........Ketan Parekh.Yes, the man fondly known as Big Bull.He is the only bull who can do such things when the chips are down in global economy and world is seeing the recession and still Indian market can go for Upper circuit.
What a day it was!No one imagined that Bulls can retaliate in such a manner.
Ketan Parekh is the main man behind this whole massacre for bears.People do not believe that KP is active but he is and he is the main driving force of Anil Ambani's MF's and his personal asset.The only person who is also known as ONE MAN ARMY can only do this and no one in the world can do it.
Well, for taking one or two stock in UC for whole day is possible but holding the market in UC (upper circuit) is not a child's play.It needs an expert hand to do it and that too who has courage and capacity what to do when .Like if selling comes that needs to be absorbed too at the same time otherwise the circuits gets open and market can't have another circuit.
Keeping the market for 20% upper circuit for whole day is surely a very daunting task to undertake and that was done with very great precision , just like doctor use to operate a body with seccisors and with steady hands.
I got the news on Saturday itself that market will go for upper circuit but refrained from writing it here as anythings can happens when Bears have made loads of money and to keep market in UC for whole day is an Himalayan task.But they did it.KP did it.One man army did it.No one else has the guts to do it and take on bears.He did it in Akruti Ltd as well and also in Educom as well.
These are my guessing and hence one need to believe it the way he wants to.
But after being in the market for 24 yrs I can guess all these things.I have not met anyone personally but I know the modus operandi of many operators and I can smell who is behind which stocks.That is all due to my experiance and observing the market and trying to find all information from every which way I can.I read a lot.

The resistant of 12700 has been crossed very easily and it is way up from there and market can still go up by 20% in the rest of the week.
Experts says that global scenario has not changed but the thing that has happened is ,India has got a clear mandate and with no interfearance from LEFT.As Samir Arora rightly pointed that not seeing Mr.Prakash Karat on TV is itself 500 points for sensex and if we add Mr.Sitaram Yechury then it can be 1000 points.
Dr.Manmohan Singh will be able to go for reform in full flow and disinvestment of PSU can materialize.This is a big victory for India that a stable government has been formed and that a person of great economic knowledge is at the helm of affairs.It was the same Dr.Manmohan Singh who opened the gate of FII's in 1991 and Harshad Mehta took the market to dizzy heights from 1800 to 4600 in couple of months in the year 1991.
I wrote at other place that market is hinting some good news coming and the members are ignoring it.They were all bearish and still are bearish.They are still scepticle about the market and expect market back to not at 7700 but at 5000! ............Lol............that is hilarious..........
US housing sector is getting stable and financial crisis is not claiming any more casualty and that is enough for Bulls to make a bull market world over.Let us see what happens in next one year.
Some one asked me about my list of cash Gr stocks which I listed here couple of months back.He needs to look at my past post or if someone can paste it here for others.

(Ilango)

BULL glorified outside the NewYork Exchange and we saw today a rare sight of 2 upward freezes of this market by the bulls(Rampaging).
TA showed its inherent strength thru' strong weekly rsi and it trapped the bears with a spectacular divergence trap.!!


A positive divergence in US mkts may result in some upward moves in world mkts and our mkts may see some intraday profit bookings tomorrow. A buy on dips should be rewarding for traders in the coming few days..




Santy

Well, the surprise was anticipated because of election result during the weekend, it was not expected that this is going to be such a BIG surprise. Market moved almost 15% high within seconds after opening and closed above 17.7% at the end of the day. As you can see in the chart, we expected nifty to touch 4068 (78.6% Fibonacci retracement), but it retraced more than 88.6% Fibonacci level(4368). If this exponential move continues than Nifty will touch 4594-4729 (more than 100% retracement) pretty soon. But after seeing this kind of wild move, I would suggest to stay away don’t bother BUYING and SELLING as long as things have not been settled down.

(SVShah)

Daily Market Outlook: 19 May 2009

TRADING HALTED FOR THE DAY

The one-sided win for the UPA government (lead by 262 seats) in the 15th Lok Sabha election, which shrugged off the exit polls results drastically, brought great cheers for the markets in early trade. The benchmark indices locked at upper circuit. The BSE and NSE have decided that the trade will start at 11:55 am (i.e. after two-hour halt).

In the first 30 seconds of trade, the Sensex crossed the 13,000 mark and inched up towards 14,000 level. This was the first time since October 2008 that the Sensex surpassed the 13,000 mark and the Nifty crossed the 4000 level. Huge upsurge of 420 points or 11.4% in the SGX Nifty was suggesting the same trend.

The manner in which the markets jumped gaining 300 points on Friday, was an indication of investors expecting better elections results than previously expected. Saturday’s election results came strongly in favour of the UPA. Many believed UPA’s clean sweep at the polls to be a favourably historic event and the Sensex opened at upper circuit at 13936.30 points up by a whopping 1789.88 points or 15 per cent within few minutes of opening. With the Sensex hitting circuit, the market was halted and was slated to open back at 11.55 am. After opening second time, the Sensex jumped 17.34 percent, or 2,110.79 points, to 14,284.21 points. Trade was finally halted for the day before noon. Even the midcap and the smallcaps too were up by 11.75 and 9.05 per cent respectively.

NIFTY (4323) : Start Lightening Your Positions Around 4450/4550

Support : 4075 / 4000 / 3830

Resistance : 4475 / 4630 / 4650 / 4775

SENSEX

Support : 13500

Resistance : 14450 / 16045

NIFTY FUT (4332)

Support : 4120 / 3905

Resisitance : 4485 / 4635

MKT COMMENTS

2 upper circuit in a day. Only few minutes of trading. FNO DATA not reliable.

We expect NIFTY FUT to show profit booking at higher levels due to sharp rise.

On Tuesday,

Buy NIFTY Above 4330,Sl Below 4305,Tgt 4385/4415/4445/4520/4660

Sell NIFTY Below 4300,Sl Above 4325,Tgt 4250/4205/4145/4100/3960

Buy ORCHIDCHEM Above 110/15

Buy LICHSG Above 425,Sl 420,Tgt 430/35/40

The candle of Friday 15/05/2009 of is a bullish candle. The last whole week the range of BSE Sensex was 11635-12200. The much awaited results of polls of India,s election-the world,s biggest /largest democracy are out. The expected mandate by the media and the political pundits about "Not any party will get majority .It will be a hung parlament." has been rubbished by voters and if anything. One single party The UPA or Congress has come with thumping majority. Nobody had predicted the this landslide victory for UPA. So in a technical paralance "Unexpectedly-expected happened."

So now with the confusion ending at "Who will rule India for next 5 years ?" quite conclusively. A market enthusiats can now with a single dedication watch and observe market only. Market by its own defination abhors uncertainity. The rally of the past month which had surprised everybody-all analyst,market watchers and observers. Now the way we see rally. Can it be said that probably market underbelly knew all this. It had already discounted this event and rewarded the Indian Investor with a steady Uprise rally.

BSE Sensex Daily Chart Till 18/05/2009

If on monday 18/05/2009 if the BSe Sensex open with a gap up, it will be anybody,s guess. If so then again BSE Sensex may go back in ascending channel.And a target of 12686 can be achieved and BSE Sensex may try to touch 13000 mark sooner.

Structure Of Sensex
Since low of 7700 in November 2008, Higher tops & Higher bottoms structure was seen in the daily chart. Structurally from January 2009 again it has given way to Lower tops & Lower bottoms. Sideways struture has (Higher Tops - Higher Bottoms, Lower tops - Lower bottoms). If the rally continues above 13000, then sideways structure for the market can be said to be over.Side-ways is often a period of breather or uncertainity.

Momentum Indicator /Oscillator
Currently in the Daily chart the KST momentum indicator is in overbought zone, indicating a strong rally. KST Oscillator indicate bulls have a upper hand as of now.

Note: "The KST was in overbought zone most of the time in the trending market of 2005-2007. But in the daily BSE Sensex chart shows that since fall in January 2008, the KST indicator broke the zero line from the upside and migrated to south - oversold zone. Since January 2008 KST Indicator has been in oversold zone. At every rally in the BSE Sensex KST indicator briefly touches the zero line or equilibrium line, but again fall back to form new trough in the oversold zone. This phenomen is indicated in the Daily Sensex Chart with down arrows, in earlier BSE Sensex Posts."

Volume
The volumes From November 2008 to January 2009 are descent, they look more of accumulation . But accumulation can be authenticated on the descent rally. On 10/02/2009 highest volume was seen.The March 2009 rally now seems to authenticate the volume accumulation since November 2008. In April 2009 the rally has been on a rising volume which is good indicator that this rally is a powerful one. All this observations have come true.Volume is one of the informant cog or puzzle chip in over all technical picture.

Trendline
Since BSE Sensex is now far away from Decending channel drawn from high of January 2008. As seen in the BSe Sensex Daily Chart, we will now only articulate on ascending channel formed from late March 2009.

"Since high of 21206, in January 2008, a clear descending channel is seen in the above daily chart of the Sensex. BSE Sensex attempted breaking out on upside on 4 occassions, dated -16/05/2008, 12/08/2008, 05/09/2008, 12/02/2009. But on 16/03/2009 BSE Sensex did successfully crossovered the descending channel on the upside." For more reference one may visit old BSe Sensex posts.

Retracement
Since the fall from high of 21237...January 2008,the retracements of 32%-13097, the 50%-10597 & 61.8% -8096 levels.
BSE Sensex on 6/03/2009 made a low of 8047, thus covering 61.8% of the total fall and on 08/04/2009 crossed 10597, thus covering 50% retracement of total fall.

Moving Averages
In the daily chart of BSE Sensex the last week all moving average from 13ema, 34ema, 50sma & 100sma were successfully crossed. Crossing of 200dma on 24/04/2009 was crucial and often a tough resistance area. In fact the crossing of 200 sma and staying above it a proof that daily trend of BSE Sensex is maturing. As long as BSE Sensex is above 200dma bullish ness persists.
Sensex Key Support Level-- ----11635,11798, 11972

Sensex Key Resistance Level---- 12301,12478,12686

BSE Sensex Weekly Chart Till 18/05/2009

Currently in Weekly BSE Sensex Chart, the weekly closing is at 12173 a Hanging Man.Though this Candle does not fulfill all the criteria of a hanging man. BSE Sensex weekly candle has support of 13 ema & 50 sma, and stiff resitance of 89ema which is at around 12417. Now on further persistance of rally, the target of symmetrical triangle may become achievable which is at 13420.

Old Overview of BSE Sensex Weekly Chart. (For those who joined late in this trend analsyis.)
In the Above Sensex Weekly Chart from the high in January 2008, BSE Sensex has been trading in Weekly Descending channel. In October 2008 sensex broke out of descending channel signalling exhaustion and since then has been trading side ways below the descending Channel. This sideways trading has given to formation of symmetrical triangle. The symmetrical triangle often referred to as side-ways or consolidation pattern. It means before embarking upon any trend, it is breather period.The last week it was indicated that we will revisit the Symmetrical Triangle once again. Since Late february 2009-it was indicative that BSE Sensex may give a down fall. Hence bearish scenario was taken into account.
Symmetrical triangle though are a continuation pattern usually. But sometimes Triangles may act as a reversal pattern also. As it is Triangles are one of the most trickiest patterns. Hence we revisit the pattern in BSE Sensex Weekly and have a re-look at our targets.
This weekly Triangle has given breakout downward at 9250. So now we will consider 9250 for calculations purpose.
The calculations now stand as follows:
The base of the triangle is (High 11870-Low 7700) = 4170.
Upward target after Breakout will be (9250+4170) = 13420.
Again this target of 13420 can be said to be achievable provided the uptrend line of the descending channel is crossed by the BSE Sensex on the upside which is 12200-12400 currently.

Momentum Indicator /Oscillator For Weekly chart
In the weekly chart momentum Indicator KST has almost given a breakout on the upside to overbought zone. The breakout above zeroline is indicative of good times ahead for bulls. But the weekly KST Indicator needs to spend more time in overbought zone to further affirm bullish ness on a weekly level.
Currently the intermediate tone can still said to be bearish in the BSE Sensex. More clarification in coming weeks may lead to a proper conclusion of intermediate trend of BSE Sensex.

BSE Sensex Monthly Chart Till 18/05/2009


The Monthly January 2009 candle was bearish.While February 2009 was also bearish .March 2009 was a bullish candle ,thus forming Bullish Engulfing Pattern on monthly BSe Sensex Chart.The April 2009 is bullish belt hold line candle pattern.Currently May 2009 candle is again a shooting star.But real call can be taken on monthly May 2009 candle at the month ends. In the BSE Sensex monthly chart has support at 100sma which is at 8255 & 50 sma is at 12272 .

As has been indicated may times in all old BSE Sensex posts, that bull market or bull trend in BSE Sensex cannot said to be over for longterm till monthly uptrend line2 drawn from low from year 1981 gets broken. And so far it does not appear to have broken. So long term BSE Sensex is still bullish.
Momentum Indicator /Oscillator For Monthly Chart
In the monthly BSE Sensex chart the Momentum Indicators or Oscillators KST is in over sold zone. The KST momentum Oscillators has given proper bullish crossover in monthly BSE Sensex chart .Hence May 2009 is an interesting month of watch on Monthly chart.