Friday, January 8, 2010

Market outlook for 08/01/10

The key indices snapped four-day winning streak on profit booking in frontline stocks. Weak global markets also dampened sentiment. Auto, IT and realty stocks led the fall. But Index heavyweight Reliance Industries held firm. Consumer durable stocks rose. The market was volatile. The market drifted lower in early trade as investors cashed in on some of the recent strong gains in share prices. The market recovered from lower level in morning trade. However, the intraday recovery proved short-lived. The market extended losses in early afternoon trade. A bout of volatility was witnessed in afternoon trade as the Nifty cut losses soon after hitting a fresh intraday low. The market weakened again with the Nifty hitting a fresh intraday low in mid-afternoon trade. After a strong rebound, the market lost ground once again in late trade. Nifty ultimately closed day at 5,263.10 down by 18.70 points. Nifty January Future closed at 5,259.00, discount of 4.10 points.
  • FII sold in index futures, and stock futures but bought in index options and cash (Net sell 1117 Crore)
  • US markets closed just flat to Positive.
  • Global cues are flat to Positive.
  • SGX nifty is just flat to Positive as of now.
  • Most Active January Nifty Call Option: 5300 and 5400.
  • Most Active January Nifty Put Options: 5200 and 5300.
Over all view
Supports: Sustaining below 5260 can extend the correction little more towards 5235/40 zone, which is arguably one the most crucial place. Holding that nifty can spin higher again. A fall below the above level will take to 5200-5140 really very fast (most important place for positional long/short).
Resistances: 5275-85 is big, above that 5330/35 again possible as discussed.

NIFTY Technical
Current Spot: 5263.10
Pivot: 5269
3DEMA: 5263
7DEMA: 5227
20DEMA: 5151
RSI (7 days): 70.85
Supports: 5239 - 5215
Resistance: 5293 - 5322

Target Nifty
Buy Nifty above 5263 - 5272 - 5281 - 5293 SL - 5246
Sell Nifty below 5246 - 5237 - 5228 - 5215 SL - 5263

Stock Ideas for the Day
RIL-Looks set for a big move..?
In daily close chart- It has broken out. In day/week candle chart, it is at the channel resistance.
Since Post Election results of last year, this stock has been consolidating. Either breaks out of 1120 & 1145 to much higher levels or correct towards 1025; then launch into big move up..

Reliance Industries: Buy above 1106 for targets of 1120, 1136, 1157 SL of 1098
Reliance Industries: Sell below 1098 for targets of 1088, 1079, 1062 SL of 1106
Shree Renuka Sugar: Buy above 243 for targets of 251, 260 SL of 232 (1-2 Days)
Opto Circuit: Buy above 241 for targets of 246, 251 SL of 233
JP Hydro: Buy above 84.2 for targets of 86, 88.5 SL of 82.4 (2-3 Days)

Positional Call
GTL Infra: Buy above 38.75 for targets of 44 SL of 78 (2 Weeks)
Bank of Rajasthan: Buy above 77.5 for targets of 89 SL of 72 (3 Weeks)
Voltamp Transformers: Buy above 935 for targets of 1087 SL of 890 (1 Week)

I like to buy things I can understand. I do a lot of research on things - Warren Buffett

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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