Today's weekly/monthly close will be important for NIfty and world markets... Watchout for the credit policy today

NIfty View:


Last hope for Bulls is the two converging green lines which meet at 4800-4810...

And the 2 reasons apart from this is:
1)The low made on 27/11/2009 of 4806 is a very important level and should hold..
2) Relative Strength Index is at extremely low level. We know that RSI can stay at lower levels for longer periods but RSI can't go in negative... It has to stop falling further first

If 4800-4810 holds for Index then we can see Nifty bouncing back to 4910/4950


Dow Jones View:

10100 on closing basis is still holding, A close below 10100 on DowJones will open gates for 9700-9750 which is also the 23.6% retracemenet of the entire rise from 6450 to 10750.




FTSE (London ) View:

5000-5100 should act as an important support for FTSE (London) because of 2 reasons
1) Trendline support joining all important lows since March
is at 5000
2) 5066 is 23.6% retracement level of entire upmove from 3500 to 5550
So this downmove should stop here to make a fresh uptrend


Have a Nice trading Day

Regards

Ankit

Nifty should hold 4800 for a bounce back to 4910/4950... DowJones Bang on Target.. Didn't close below 10100 as expected & hits low of 10105

Nifty View:

Last hope for Bulls is the two converging green lines which meet at 4800-4810...

And the 2 reasons apart from this is:
1)The low made on 27/11/2009 of 4806 is a very important level and should hold..
2) Relative Strength Index is at extremely low level. We know that RSI can stay at lower levels for longer periods but RSI can't go in negative... It has to stop falling further first

If 4800-4810 holds for Index then we can see Nifty bouncing back to 4910/4950 . As today is the expiry of January contract so you can see volatility in the second half of the day.



Stock View:

The BankIndia stock didn't fall as much as the other Banks and the stock is still holding steady above the green trendline. The stock is a Risky pick but it can be bought at current levels of around 375 with a stop of 368 for targets of 390-400.

A move above 400 with volumes can take this stock to 430/460.



Have a nice trading Day

Regards

Ankit

4950-5090 on Nifty seems to be the range as of now... People sitting on cash can now start deploying it but in a staggered and pyramid manner

Use this fall of 10-15% in Nifty if and when it happens to build a portfolio and that too in a smart manner. This strategy is useful because u get to buy stocks or ETFs at important support levels. The best thing about this pyramid startegy is that the net acquisition price of the Index will much lower than in case of simple averaging.





Now let's take an example:

If there is some person Mr. X and he wants to invest 1 lakh ruppes in current scenario. We would look at his returns in both the cases.

In the case of Pyramiding:
He invests Rs20000 at 4950 (20%).
He invests Rs30000 at 4750 (30%).
He invests Rs50000 at 4450 (50%).




Then the cost of acquisition comes out to be 4640

In case of Averaging:
He invests Rs33333 at 4950 (33%).
He invests Rs33333 at 4750 (33%).
He invests Rs33333 at 4450 (33%).

Then the cost of acquisition comes out to be 4716.


So its clear that acquisition price in Averaging ( 4716 ) is 1.6% higher than in the Pyramiding (4640).

So Pyramiding will give jump start return of 1.6% which simple averaging method cant give.

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Nifty trading strategy for extreme short term:

Buy Nifty above 5040 for targets of 5080-5090.

Sell Nifty below 4980 for targets of 4930-4950.



Stock View: Liberty Shoes

After the drastic fall in Jan 2008, Stock bounced back but was not able to close comfortably above 110 level. After Jan 2008 stock tried to cross 110 level but it failed 5 times. Now the stock is a buy at current levels and on dips to 106-107 for targets of 140 and stop loss for all trades should be kept at 100.



Have a nice trading day

Regards

Ankit

Bang on Target... 4954 Nifty's low and then rally upto 5080 level... DowJones didn't close below 10100-10200 range

After stupendous rally in Nifty from the lows of 4954 ( we predicted this right :p ) to 5080 on Friday, we could see Nifty trading in this range till we see a breakout or a breakdown. There can be only two scenarios in this case and the same i will discuss now.


Nifty View:

Scenario 1: In case of a breakout above 5080-5090

In scenario 1, if Nifty is able to cross 5080-5090, the level from where Nifty reversed back on Friday, then the next hurdle is placed at 5170-5180 which is 61.8% retracement of the entire downmove from 5310 to 4954. It would be an uphill task for bulls to cross this level of 5170-5180, so the chances are that we can easily see a small dip to 5080 level and then a strong pullback to overcome resistance of 5180. If 5180 is crossed convincingly with volumes then we will most probably continue to look for new high above 5310. And it will also confirm DowTheory of Higher Highs and Higher lows.




Scenario 2: If Nifty closes down below 4920-4950

In scenario 2, in case of a breakdown below strong support zone of 4920-4950 and remember breakdown here also means that we should close below this range of 4920-4950. Incapability to cross 5180 and a close below the range of 4920-4950 will give a confirmation for Head and shoulder pattern which I have tried to visualize in charts. In this case the next major support after 4920 will come around 4750-4800 and the last and final support will come around 4550-4600 ( a close below this level will end the entire upmove momentum. )




Stock View: JUBLIANT

Excellent Flag pattern observed in this stock. Trading can be done in both ways:

1) Buy above 363 for targets of 380 and 395

2) Sell below 326 for targets of 315 and 292.

Keep acquisiton price as your stop loss if first target is achieved.




Have a nice trading day

Regards

Ankit

4920-4950 on Nifty & 10100-10200 on Dow Jones if breaks on closing basis then honeymoon will be over for Bulls

Nifty View:

Finally Nifty did something rather than moving in a tight range. Not able to move higher above 5310 Nifty chose to breakdown below strong support zone of 5150-5160. Now the next final support lies around 4920-4950 cuz as you can see the both red support lines are converging at 4920-4950. It will not be broken easily and the index should atleast give a dead cat bounce from these levels. But remember this support zone should not broken on on a sustained closing basis .




Dow Jones View:

First and Biggest fall of the year 2010 in Dowjones will have its effect over other world markets... Grey momentum line starting from March 2009 lows gets broken today...10100-10200 on DowJones will act as a rock solid support as u can see the two red lines converging there which means that indices should atleast hold this levels and bounce back. A sustained close below this support zone will end the party for bulls.




Stock View: Reliance

1130-1150 acted as a strong resistance for the big boy. Not being able to cross this resistance level stock chose to come down and now close to support zones of 1000-1020. This support zone should hold as this is formed by convergence of purple trendline and red supportline





Stock View: SBIN

After breakdown of purple momentum line stock never displayed strength. Now the major support zone is around 2050-2060 which can be considered as a stop loss for short term trades. A sustained close below 2050 will result in further selling in this stock which can take it to next support zone of 1900-1850 where investors can use this opportunity to enter this stock but obviously in a staggered manner.



Hope u have a nice trading day

Regards

Ankit

Dow Jones pare losses to close down around 100 points, Don't go short @ opening bell around strong support zone of 5150-5160

Nifty View:

Nifty might open gap down at around strong support zones of 5150-5160. Below 5150 only Nifty will get weak for extreme short term.

Below 5150 also there is a strong support zone around 5100 because of 2 reasons.
1. Black trendline support comes at 5110 which joins two recent lows.
2. 50 DMA is placed around 5100.

Short Nifty only if it sustains below 5150 for targets of 5110-5100.



Dow Jones View:

Around 10500 there is a huge trendline support. The trendline is drawn by joining 3 major lows during this non stop rally from 6500 to 10500. The DowJones will get somewhat weak if it closes below 10500 but next good support is not far away which is placed at 10150-10200 - a combination of 2 support lines ( orange and black line ). Any close below 10100 will be a worry sign for investors and traders.




Stock View: GtlInfra

The stock after such a big move from 37 to 43 has been consolidating in a 5% range of 43-45. The stock is a strong buy above 45.5 for target of 47.5-48 and the stoploss for the above mentioned trade should be kept at 42.7.





Have a wonderful trading day

Regards

Ankit

Is 100 point rally in Dow Jones enough to take us past 5300??... Let's see. Midcap Banking space looks good

Dow Jones shot up around 100 points last night on the account of merger between Kraft Foods and Cadbury. This might give world markets a direction to move instead of trading in a range bound fashion. As mentioned in the blog yesterday Nifty took support from around 5225 level and it was advised to buy at that level and sell at 5265 ( which you can do today if Nifty opens gap up.)


Nifty View:

Now Nifty's 5150- 5160 level is becoming a strong support. Till 5150-5160 the index is a buy on every dip. A closing above 5300 will open gates for 5400-5450.






Stock View: Federal Bank


The stock tried to give a channel breakout today but it was an unsuccesful attempt. Buy this stock if sustains and closes above 274 for targets of 300 or Buy on dips to 260 with a stop loss kept at 256 for the above mentioned targets.




Stock view: IOB

Excellent converging pattern seen on charts Buy above 115.5-116 for targets of 122. The stop loss for this trade should be kept at 109.5.




Previous Stock Recommendations:

Brigade rocked hitiing a 20% circuit
Rel Cap and Uco Bank hold with stop loss
Wait for GVKPIL to breakout


Have a Nice trading day

Regards

Ankit

If you don't have guts to go long in the markets at current levels then atleast don't short it... Wait for a breakdown below 5150-5160

DowJones down 100 points overnight + Asian markets trading weak is not necessarily equal to placing the first order as short @ opening bell. The same thing happened today when @ opening bell people were going short in the anticipation of 5180 on Nifty. Never go short in a rising uptrend until and unless its a hedge position. Always wait for a breakdown to occur to go short.


Nifty View:

5225-5235 on downside is acting as a great support zone. Buy around these levels to sell at 5265-5275. If Nifty goes below 5165-5185 with volumes, go short for targets of 5135& 5100.


Stock View: UCO Bank

A move above 61.6 was enough to give a multi-month breakout. The stock made four attempts to cross 61.6 but all were unsuccessful. If you go by the charts you can see all 4 unsuccessful attempts until the last one which was a succesful one :). The stock gave a strong bounceback yesterday from a strong green support line. The stock is a buy on dips for targets of 67 and 69.





Stock View: Rel Capital


The stock has underperformed the Index by a meaningful margin. Now the stock is trading closer to its multi-month Red trendline but is not able to cross it due to lack of volumes. The stock is a buy on a move above 925 with a stop loss of 885 for targets of 965-970, the only imp thing is that just watch out for volumes in this case. You can also buy this stock on dips to 865-875 for the above mentioned targets.




Stock View: GVKPIL


This stock is also trading near its multi-month highs of 53.5-54 plus there is a red trendline acting as a resistance at around 55. A move above 55 and that too with huge volumes will give a nice breakout for targets of 65 & 70. The stop loss for all trades should be placed at 49.5.



Have a nice trading day!!!

Regards

Ankit

5165-5300 remains the range till we break on the either side. Budget, RBI policy and Q3 Earnings are the events to watch out for

NIfty View:

5165 on the downside will act as a strong support as this level acted as a resistance since the last2-3 menths. Blue line is the last support for bulls, below which all short term rallies would end. Red line is the resistance line from which the Index should bounce back or take a support. Green line ( support line) + Red Line ( Resistance Line), both lying at around 5170 will act as a major support.





Stock View: IDBI


Since October 2009 the stock is trading between the parallel lines. There are two ways of trading this stock. First is wait for the breakout above 140 and then only buy it for target of 160. Second is use method of pyramiding, buying the first tranche at around 130 levels and second at around 120 levels and holding it for short term for targets of 160 & 180.






Stock View: RCOM

After hitting a low in October 2009, the RCOM stock was rangebound between around 170-185 levels. Now the stock has given breakout above 185 and should be able to achieve Min target of 200. So the stock is a buy on dips with an intial target of 200. Above level of 200 if sustains can very well do 225 in short term. The stock has also been underperforming against its telecom peers so its time to play some catchup.



Have a wonderful trading day

Regards

Ankit

In Index, watch out for 5225-5235 on downside and 5275 on upside

NIfty View:

Buy Nifty if sustains above 5275 for target of 5300-5320 for a small trade .


Stock View: Punjlloyd

After the massive fall of 33% from its peak of 298 due to bad results in Q2 Punjlloyd stock until today kept languishing around in a 190-218 range which was broken today. The stock is a buy at current level or on dips with targets of 244 & 255 with a strict stoploss of 209 closing basis. The stock is moving higher due to anticipation of good results this time in Q3.

Stock View: Brigade

After 5 months of unsuccessful attempts to cross 145-150 level on stock, Brigade has finally closed above 150 and that too with huge volumes which indicates a price volume breakout. So buy on declines or above 153.5-154 for targets of 175-190 and stop loss for all trades should be kept at 139.


Have a wonderful trading day.

Regards

Ankit

Sometimes neither good news is directly propotional to rise in stock markets nor bad news is directly propotional to fall in stock markets.

Nifty View:

Takes support at 5180 and bounces back sharply to 5240. The last double top at 5180 acts as a huge support which now results in widening of range to 5180-5320. Any close below 4900 will result in " Party is over, go home !!! ". Above 5320 will result fresh round of buying.





Stock View: Tanla

Since June 2009 if we connect all the tops again i.e Red line, it lies currently at 65. Plus there is an important support line ( green line ). Buy if crosses and sustains above 66 for extreme short term target of 76 and stop loss would be 62.




Stock View: DCB

Price Volume breakout!!!!!. if it crosses red line which is joined from May 2009 connecting all the tops then it can target 44 and 49. The volume breakout is the largest in last 3 months. Buy only if it sustains above 40 for short term targets




Stock View: ABB


Excellent pattern!!! If croses and closes above 830 then we can see a huge upmove. 830 is a huge resistance as it is the line which joins the major tops since june 2009. So buy if it sustains above 830 for target of 890-920 and stop loss would be 780




Yesterday i could not upload my blog due to technical reasons, although it was ready :(

Have a nice trading day

Regards

Ankit

Index rangebound between 5235-5300, Infosys results above expectations may act as a trigger

Leave Index and concentrate on stocks and keep trailing stops and remember when all these dabba stocks start to move up then market is near the top.

Stock view: PNB
Buy on closing above 960 for target of 1025.

Stock View: Srei Infrastructure
Buy above 94 target 100.

For Dowjones & Nifty detailed view just see the previous post as nothing has changed much.

Have a nice trading day

Regards

Ankit

1000 hits and counting... I thank all the blog readers from the bottom of my heart.. Wishing u a great 2010

The index is waiting for cues or fresh triggers to continue its upmove after the big breakout above 5180. This upmove will get capped at anywhere around 5350-5550. The first sectoral index to show some weakness is CNX IT which is due to fundamental reasons of rupee appreciation. So all exporters like IT solutions providers, gold jewellers & Textile manufacturers will have to lose out due to lower conversion price of dollar and their margins will get hit. Margins contraction can be overcome by creating appropriate hedge positions in currency market. This all will be seen when these companies will post their Q3 and Q4 results and disclose their other income component which includes income due to hedge positions.


Options Strategy:

Try using Long Straddle if the market opens earlier than Infosys results are announced because until last quarter Infosys results came at around 9:15 am and the markets opened at 9:55 am. But due to earlier opening at 09:00 am you can use this strategy

Buy INFOSYSTCH 2450 PA at 56 rupees
Buy INFOSYSTCH 2500 CA at 53 rupees

TOTAL COST: 109

If the results are good then cover it when Infosys is around 2530-2550, and if they are bad then cover both call and put when Infosys is around 2380-2400. Profits will be max if there is anything majorly positive or negative in the results.



Nifty View:


NIfty has overhead resistances at and around 5350-5550. If you see in the chart there are two red lines which join Jan, feb & March tops & that comes at 5350-5500 plus two black parallel lines from June 2009 have its upper range till 5550. So if it has to be non-stop rally without any meaningful correction then it will stop at 5550 or earlier than that. So keep trailing stop losses and keep booking profits and don't be over-leveraged.




Dow Jones View:

11000 on Dow Jones seems likely only if it moves above 10700 with volumes. At 11000 Dow jones will face resistance as the line joining major tops since May 2009 is currently at 11000. If it crosses that as well then it can go to 12000 as the next major top is around that level only which was made during july-sep 2008. All longs on Dow Jones should have 10200 as their trailing stoploss on closing basis.




Stock View: Satyamcomp


Nice inverted head and shoulder pattern seen in Satyam stock which is a bullish pattern plus there are huge volumes before the breakout above the red resistance line which indicates that stock can be bought on dips till it doesn't close below 100 or if sustains above 116. Closing below 100 will negate the whole pattern.




Stock View: Petronet lng


Petronet stock did gave a breakout above the 6 month old resistance line which was formed joining major tops during this 6 month period. The stock is now a buy on dips candidate with a stop loss of 72 and target of 80-82.




Stock View: Videocon Ind


The VIDEOIND stock is witnessing a huge cup and handle breakout pattern above 270 plus there is a triangle formation pattern also. The stock becomes a buy if it closes above 270 for a minimum target of 320-330 for short term.




Today, this big post will compensate all the smaller posts that were published earlier. I am tired after this one.

Have a nice trading day

Regards

Ankit

Trading in Index is boring, Stock specfic is interesting

Nifty View:

Nifty has a good support around 5125-5135 and there are multiple resistances around 5350-5400 levels. Today closing will be important as this will be a weekly closing.

Stock View: Arvind

Though textile sector is termed as a laggard sector, but it also gives a breakout sometimes. Arvind is also in textile sector and has given a nice breakout with huge volumes. So one can buy around current levels with a target of 50 and 55 in very short term. And those people who keep waiting for their acquisition price can exit or earn some profit. This is one of the stock only, right now whole of the textile sector is looking good.

I could not post a detailed post due to personal reasons

Have a nice trading day
Regards

Ankit

Back from a 3-day break, This may be the last 1000-1500 points rally left on sensex, Be cautious and use trailing stop losses

I could not post blog for 3 days as i was out of station. I apologize to all those people who visited during this 3-day break but could not find any new post.

Nifty view:

Nifty is trading in a channel within a bigger channel. The smaller channel has resistances around 5330-5370 and the bigger channel has resistance around 5500-5600. But that doesn't mean there is any reason to short, go with the trend and dont go against it. Either hedge your positions or book partial profits. For very short term NIfty has support around 5230-5235.



Stock View: CESC

Stock is trading in this channel since last 6 months. Going by the huge volumes in this stock if it closes above 435-440 can take this stock to 500-520.



Have a nice trading day

Regards

Ankit