Wednesday, February 24, 2010

Market outlook for 24/02/10

After facing huge volatility throughout the trading session, the domestic market today closed the session with marginal gains as cues from foreign market supported the growth. The benchmark indices opened the market with negative note but managed to gained momentum and moved into the positive territory as buying interest emerged at lower level. Throughout the day the market saw up and down movements over the dotted line as the investors remains a bit calculative ahead of the Railway budget and the Union budget 2010-11. The benchmark indices recovered from its initial loss and jumped ahead to raise the market further on account of selective profit booking that emerged across the Realty and Metal indices. The traders are also cautious ahead of the Federal Reserve Chairman Ben Bernanke's announcement about the key interest rates in the U.S. which may begin to rise. The statement by the Finance Minister Mr. Pranab Mukherjee said the government will continue measures to tame inflation in the financial year ending March 2011 also boosted the investors' sentiments. Moreover, the cues from the positive European markets also supported the market to grow further. However, Asian markets closed in mixed note. Nifty closed the day at 4,870.05 up by 13.65 points. Nifty February Future closed at 4,880, premium of 9.95 points.
  • FII bought in index futures, stock futures and cash but sold in index options (Net buy 788.7 Crore)
  • US market ended in Red.
  • Global cues are flat to Negative.
  • SGX nifty is Negative as of now.
  • Most Active February Nifty Call Option: 4800 and 4900.
  • Most Active February Nifty Put Options: 4900 and 4800.
Over all view
Nifty daily chart has formed “White Spinning Top” this suggests uncertainty hovering in the market. Intraday chart study tells that nifty has given sharp fall and formed “Double Bottom” at 4857 level and bounce back to 4870 level. Stock specific activity is likely to continue as we are in budget week. On down side 4675 is a strong support and on upside 4918 is an important level to watch. Simple word be cautious and capital preservation is advisable.
4835 provided support as discussed yesterday. Nifty is absolutely range bound between 4920 and 4800. But some impulsive action from upside down implying some impending weakness in it.
Supports: 4835/40 is crucial level. Violation of this level can bring 4820-4808/00-4785. Below that 4750-4715/25 are achievable.
Resistances: 4895 and 4915, a confirmatory breakout above 4925 will bring 4945-4975/85 to decide further movements.
NIFTY Technical
Current Spot: 4870.05
Pivot: 4862.65
3DEMA: 4865
7DEMA: 4857
20DEMA: 4885
RSI (7 days): 52.2
Supports: 4841 - 4812
Resistance: 4892 - 4914

Target Nifty
Buy Nifty above 4874 - 4894 - 4920 - 4953 SL - 4861
Sell Nifty below 4856 - 4840 - 4807 - 4781 SL - 4866

Option & Futures Call
Buy Nifty 4900CE above 24.2 for targets of 33.1, 43 SL - 20

Stock Ideas for the Day
Reliance Industries: Buy above 978 for targets of 983, 991, 997 SL of 975
Reliance Industries: Sell below 975 for targets of 970, 964, 957 SL of 978
DLF: Buy above 292 for targets of 294, 298 SL of 287
Ansal Infra: Buy above 68 for targets of 69.2, 70.7 SL of 66.7

Swinge Trade Call
Housing development and infrastructure (HDIL) is nearing its strong support of 288-290. its has formed a triple bottom formation here and if it holds onto 288-290 levels it show a bounce upto 310-315. One can enter it at around 290 with strict sl at 285 (closing basis).
Couple of closes below 285 could take the stock lower to 260.
If you don’t follow the stock market, you are missing some amazing drama - Mark Cuban

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

Thanks and Regards

S&P Wealth Creators

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