Market outlook for 19/02/10

After seeing 2.4% rally in the last two days, Nifty witnessed profit booking today and slipped below the 4900 mark. Heavyweight Reliance Industries was the main culprit behind this fall; the stock shut shop below the Rs 1000 level, down 3.35%.
Selling was also seen in metal, cement, capital goods, private power, realty and select technology companies' shares. However, buying in biggies like NTPC, HDFC Bank, Bharti Airtel, Infosys, HDFC and HUL capped the losses to some extent.
Nifty closed the day at 4,887.75 down by 26.25 points. Nifty February Future closed at 4,884 discount of 3.75 points.

• FII sold in index futures and cash but bought in stock futures and index options (Net sold 399.2 Crore)
• US market was Positive.
• Global cues are flat to Positive.
• SGX nifty is Positive as of now.
• Most Active February Nifty Call Option: 4900 and 5000.
• Most Active February Nifty Put Options: 4900 and 4800.

Over all view
Nifty daily chart has formed “Small Black Candle” suggests uncertainty in the market. Strong support placed at 20 days Simple Moving average which is at 4866 levels. From here on we are expecting market to give more weight age to macroeconomic news rather than technical alone, as we have immediate near term trigger is Union Budget on 26 February 2010. Technically Nifty needs strong and sustainable close above 4900 for up move to continue. Any portfolio buying should be avoided till budget.
Support: 4870 is immediate, below that 4840-4830 is possible, before deeper breakdown towards 4800-4750-4720.
Resistances: Lies around 4935, but as it seems like and impulse, higher targets can be done as the 5th wave at 4965 and 4985.

NIFTY Technical
Current Spot: 4887.75
Pivot: 4894.50
3DEMA: 4879
7DEMA: 4853
20DEMA: 4895
RSI (7 days): 54.71
Supports: 4867 - 4846
Resistance: 4915 - 4943

Target Nifty
Buy Nifty above 4895 - 4908 - 4931 - 4949 SL - 4889
Sell Nifty below 4879 - 4871 - 4852 - 4829 SL - 4894

Stock Ideas for the Day
Reliance Industries: Buy above 1010 for targets of 1014, 1020, 1041 SL of 1008
Reliance Industries: Sell below 999 for targets of 994, 989, 977 SL of 1009
AstraMicro: Buy above 77.5 for targets of 79.5, 82 SL of 76.2 (1-2 Days)
NagarFert: Buy above 36.3 for targets of 37, 38 SL of 35.8
Bharti Airtel: Buy above 283 for targets of 285, 288 SL of 280
DLF Ltd.: Buy above 305.5 for targets of 307.3, 309.1 SL of 302.7

Positional Call
Omax Auto Ltd.: Buy above 57.5 for targets of 65 SL of 56.8 (One Week)
Tips Ind: Buy above 46.5 for targets of 52 SL of 45 (One Month)

Diversify your investments - John Templeton

Use strict STOP LOSS in each and every trade in this kind of volatile market and Trade at your own risk.

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