UPDATE

Nifty : cmp 3672 I think I am one of the lot who became highly bullish from april onwards and gave higher tgt of 4000-4100-4300 and 4800 and capping the final tgt at 5400 when it crossed just 3000 marking it a new bull phase.And we are half way through.

Nifty expected to open with a gap in the range 5-10% upside. As written last week regarding the tgts of 3900 -4000 the same may be achieved this week .Our strategy for this turbulent gap up opening followed by short covering will be one of the follows:

1.Buy in the opening if opens around 3800-3820 for tgt 3900-3920

And sell in this range of 3900-3920

2. if this range of 3900-3920 is comfortably crossed in the opening or during the day then buy again for the next higher tgt of 4100-4120

3.Sell in the opening if opens at tgt range of 3900-3920 for tgt 3800-3820 and buy again for higher tgt of 4100-4120

4. last rare possibility is that nifty opens at a cap of 10% and trading is halted for some time . in this scenario sell sell sell around 4100

ACC: cmp 635 buy at the breakout of tgt1 640 as given last week and for the next higher tgts of tgt2 690 tgt3 730-750 with XL at 620

Rel INFRA: cmp 820 buy at the breakout of tgt1 820-825 as given last week for higher tgt2 880 with XL at 805 OR conversely sell below 805 for tgt1 770 and then 755 .

RELIANCECAPITAL: cmp 592 buy at the break out of 600 for the next higher tgt1 620 tgt2 700 tgt3 780 will XL at 575

TATA STEEL: cmp 272 BEST buy in the range of 275-285 with XL 260 for tgt of around 300 and 330 and then 380 and 420.

KOTAK MAH BANK: cmp506 buy with XL of 500 for tgt 1 600 and then tgt2 670

ICICI BANK: cmp575 BEST buy in the breakout of tgt 1 range of 575-580 as given in the last week for the next higher tgt2 600 and then 670 with XL at 570

RELIANCE: cmp 1950 buy in the breakout range of 1975 only for tgt1 2040 tgt2 2100-2120

RCOMM: cmp 232 buy in the break out of 235 for the next higher tgt1 255-260 tgt2 300- with XL at 225.

Stock with wave discussion for the week:

ABAN OFFSHORE:the stock made a high of 5435 during first week of January 2008 and was in continuous downtrend waves 1-5 since then. It has completed its downtrend as its last downwave5th ending at 217.50 on 06.03.2009 retracing exactly 96% from top. From there it is charting its new uptrend. The labelling of waves as on today is as follows which is liable to change with passage of time:

Wave1 217 - 527 = 310 pts

Wave2 527 - 390 = 137 pts

Wave3 will have tgt1 500-520( is achieved now) tgt2 740-750 tgt3 960

Wave 4 pending

Wave5 pending

(NOORESH)

Sensex Technical View :

The technical view posted a few days back had clearly mentioned about a possibility of a gap up action above 12300. This was based on the observation that after a touch down to the momentum line Sensex has broke out above the recent highs/range by a gap-up action. Click on chart below.

So ideally from here the opening gap up low would be an important level to watch from here and 12300 could be the important support.

The range for now was 11272-11620 which points to a minimum target price of 12925. So we might see a good resistance around in this zone.

On the medium term basis ever since 9k-10k levels the view has been bang on and crystal clear that this upmove should go to 38/50% of the entire downmove. The levels for the same 12900/14500 and a max to max 15800 ( 61%) which should be reached in the 12-14 months equivalent to the entire downfall period.

We might be close to achieving 12900 and 14500 is the next level but there is a very good possibility that we see a decent dip !! after crossing 12900 or a lot of pressure around this area. A technical confirmation of the dip comes only on breakout of the momentum line.

ALSO in leisure time have a read through this post -- http://nooreshtech.blogspot.com/2009/05/re-cap-sensex-8k-to-maybe-13k.html

Stocks to watchout for :

ABAN LLOYD and CENTURY textiles mentioned as performers for the day. Aban rocked 20% ++ but century did a decent 3-5% move.

BLUE Start pyramiding investment pick from 180 does 225 !! Look to book out at 240 half the qty and hold rest for long term.

I wont make a bet on policy triggers or election impact stocks as i have not enough info or will to analyze the same in extreme detail. Some of the particular stocks looking good technically are discussed below.

Central Bank of India

The stock has given a breakout above 50 levels expect it to cross 60 in coming days. Buy closer to 53 for a short term trade.

SCI

The stock has been ranged between 70-100 in the last few months. Sustaining above 100 for a few sessions should give a move to 114/130 in short to medium term. Accumulate

Alstom projects

Possible fresh breakout above 365 should target 395/450 in medium term. Buy above 365 and keep position to add on dips also for the tgts.

Power Grid,PFC ,Areva TnD look good on charts for a strong upmove and possible election impact also. Small PSU Banks like Vijaya, Dena and others could see action alongwith Neyveli Lignite,MRPL or some PSUs. Just a view no detailed idea here.

The current upmove on Monday would be backed by large caps and a possible new range on the index in coming sessions. Traders shoud take care and not be get euphoric with sentiments and be extremely stock specific as gains would now depend on stock selection.

Just a gut feeling after the euphoria this week we may see lot of midcaps/small caps which have been on low valuations may see huge moves. There is still a lot of such attractive stocks in the broader segment which have not participated in the rise.

Earlier in the months of March i did try to elicit fundamental views on number of mid cap stocks but hardly got any comments. Hope to see more comments on possible stock picks from readers in the comments or mail to noorrock2002@gmail.com

IFGL refractories, Time Techno, Patel Integrated Logistics , Dishman Pharma,Aurion pro look very much interesting at current levels. !!

Market Observations and Thoughts :

Will reserver this section for a detailed post in the week but one thing that comes to my mind at possible 13k-14k levels is that lot many large caps have moved up by 100-150% from the lows. Reliance a biggy is only 30-35% down from peak and 100% + from the lows.

Lot many participants might have increased exposure to equities in this period and will still do on the euphoria by elections. But we need to keep the discipline to avoid the possible risks and surprises.

In the month of Feb/March though there was uncertainty the strategy to go in a pyramid manner, fundament + technical stock picking in the broader market with adequate research gave us great returns. A large section of market participants feel left out though at times we felt a lot OVERBOUGHt :) till date.

So yet again we are at a stage to come up with a new strategy to counter possible risks and also create a disciplined pattern of trading/investment. Sensex may possibly reach 12900/14500 on higher side for short to medium term from where there is a good possibility of a time wise/price wise correction. Investors have exposure to MFs./long term portfolio/trading/equity linked plans.

As an individual investor its time to look into personal exposures and re-shuffle the same. Once we cross 13k the risk-reward on the index may tilt and am looking towards how we could have a HEDGE strategy through index futures,options and other instruments. Will delve more into it in the week. Hope to receive more suggestions !!

MY CHART

Nifty :: Finally suspense is over UPA win with fully majority .. Now second flag pattern works with target of 3900+ once Nifty break 3717.. In next week most probably Nifty move with extended wave as 1-2-3-4-5.. First move up then side way then again move up for last leg, may be over in first week of June.. If Nifty open with gap up avoid buying at high wait for small correction then buy.. Watch Resistance 3760/3800/3864/ 3900/3960/4000/4129..

(In Such kind of recent situation we remind you one of the oldest stock market slogan “Buy in rumors, Sell on news “ Be careful in heavy volatility )

The Singapore Nifty Futures (Ticker code IN on SGX) has gapped up by almost 10%!


(Inder Bhatia)

BUY OBC ABOVE 143 TGT 151>163 STOPLOSS 137

BUY ABB ABOVE 495 TGT 538>551 STOPLOSS 481
BUY SIEMENS ABOVE 371 TGT 389>407 STOPLOSS 355

BUYIDEA CELLULAR ABOVE 66>73>76.90 STOPLOSS 63.50

Nifty weekly chart seen breakout and close above major downward sloping line next resistances 3793 and strong support 3240-3173

Last week sensex gained 2.5% and nifty 1.4% respectively sensex close with tenth consecutive weekly gain. As poll results were great victory for UPA ,we can see positive sentiments for stock market .On the daily chart nifty was hovering in range 3500-3700 and very close to strong resistances zone s 3800 levels. For coming session we can see gap-up celebrating UPA victory and we can test 3937-4000 levels .On the lower side 3530-3470 will act support zone

The Indian market opened on higher note taking cues from global market and saw smart buying in final trading session close near day high .For coming session we had seen clean victory for UPA it will positive for stock market . we can see gap-up opening and it can test 3850-3923 zones .

Market Summary: The markets opened the session with 250 odd points downward gap mirroring extremely weak cues from the global markets and continued to languish in the negative territory for the entire day till closing bell. The exit polls indicating fractured mandate in the just concluded parliamentary elections and rating agency Fitch’s warning to cut fiscal deficit to avoid its rating lowered weighed on the market sentiments. Experts believe that volatility will continue even post election results on the back of hung parliament may come to power. Markets did try to recoup losses in the mid noon trades but finally could not sustain at higher levels as fresh bout of selling kept the benchmark indices under pressure. Surprisingly the broader markets out performed the benchmark indices as good selective buying was seen as in evident from the positive market breadth. The sell off in oil & gas, technology, banking, capital goods and metal stocks kept the indices under pressure. The overall market breadth was marginally positive as broader markets witnessed subdued buying interest with Midcap index and Smallcap index gaining almost 0.5% each respectively and was at 1 x. Finally Sensex closed 147 points or 1.22% lower to settle at 11873 levels while Nifty lost 42 points or 1.15% lower to settle at 3593 levels. Among the sectoral indices it was a mixed trend with Realty,Auto, Consumer Durables, PSU, FMCG and Healthcare out performing the most while Oil & Gas, TecK, Capital Goods, Metal and Bankex under performing the most. Among the index heavy weights, which gained the most were DLF, Cipla, Hind Unilever, Siemens and SBI while Bharti Airtel, ONGC, Reliance Ind, Cairn India and Sterlite Ind were weak and ended as losers. Among the midcap space stocks which saw good buying action despite extremely volatile and weak markets Spanco Tele, Essar Ship, Titagarh wagons, Sadbhav Engg, Bharti Shipyard, GMDCL, Oracle Fin, Mah Seamles, Yes Bank, ABG Shipyard, Aban Offshore, Bajaj Auto, Sintex and Concor were and were up in the range of 7-20%.

The overall traded volumes were extremely lower compared to earlier day by almost 23% and were at Rs 691 bn. While delivery based volume was at 26.3% of the total turnover.

Among the fund activities, FII’s were net buyers to the tune of Rs 40.85 bn while Domestic Funds were net buyers to the tune of Rs 3.93 bn respectively on 13th May 2009. While on 14th May 2009, FII’s sold shares worth Rs. 3.01 bn in cash segment (provisional) while in the F&O segment they were net sellers to the tune of Rs 4.89 bn whereas Domestic Funds also bought shares worth Rs. 2.54 bn (provisional).

Corporate News – Industry trends :

• ONGC, could report a drop in its profits for 2008-09, with the government planning to ask the company to stump up yet more cash to make good the losses of fuel retailers IOC, HPCL and BPCL (ET)

• NTPC ties up Rs 85 bn SBI loan, to help it add over 22,000 mw and become a 50,000-mw company by 2012 (ET)

• Cairn open to buying ONGC’s 30% stake in its oil block in Rajasthan (BS)

• Sun has won preliminary injunction case in the US Appeals Court against Wyeth for pantoprazole.

• United Breweries Holdings have given their nod for providing corporate guarantee worth up to Rs 120 bn to lenders of UBH’s subsidiary Kingfisher Airlines, by way of pledging of shares as also mortgaging its movable and immovable properties. (BS)
• Great Offshore, which saw an effective change of management control last week, stands to lose Rs 73 lakh daily revenue after missing the deadline to provide a shallow water rig to the ONGC. (BS)

• Eveready Industries India is set to acquire 80% stake in Uniross SA, a French company engaged in the manufacture and distribution of rechargeable batteries and allied products (BL)

• Alcatel-Lucent has been selected by Unitech Wireless to support the initial launch of the company’s GSM mobile services (BL)

• Axis Bank to will cut its benchmark prime lending rate (BPLR) by 50 bps to 14.75% from Friday. (Mint)

• Indian Oil Corp. has received a loan of $3 bn from a group of 21 lenders for its Paradip project (Mint).