Monday, May 19, 2008


NIFTY (5157 +42 pts)
Supp 5130/5100/5070 Res 5185/5230/5265
Nifty faces good resistance around 5185-5200 levels crossing which test of previous high at 5298 is highly probable. Any correction towards 5070-5100 should be considered as an opportunity to buy. 5030 may be considered as reversal point for the rally.

SENSEX (17434 +81 pts)
Supp 17300/17150/17040 Res 17510/17630/17740

Review of the previous session:-
· Markets opened higher on strong global cues but supply was seen from 17500 levels. The remaining day was range-bound. Metals and Banks were top gainers. Inflation for week ended May 3 stood at 7.83% vs 7.61%.
· BSE Breadth 1547 Adv-1137 Dec NSE Breadth 726 Adv-469 Dec Upper Circuit - 211 Lower Circuit – 103
· BSE Vol Rs 6136 Cr NSE Vol Rs 13429 Cr F&O NSE Vol Rs 37876 Cr
· FIIs bought Rs 475 Cr in cash market and MFs bought 392 Cr. In F&O, FIIs bought Index Futures worth Rs 74 Cr and Stock Futures worth Rs 384 Cr. Their Outstanding position in Futures is 41157 Cr and Options is 22196 Cr.
· Additional Data:- Gold $900/Oz Nymex Crude $126.29/bbl 1$ = Rs 42.54
F&O observations:-
· Bullish build-up – NagarFert, SCI, Bongaigaon Ref, HCC, Ranbaxy, GE Ship, Bombay Dyeing, Guj Alkali, HDIL, Neyveli, NIIT Tech
· Bearish build-up – Voltas, Renuka, Amtech Auto, Chennai Pet, Crompton, APIL, WelGuj, Dr Reddy
· Indian Volatility Index 23.25 (-19.88%)
· OI 78711 Cr (+1847 Cr) Nifty OI down 1% PCR 1.47 (previous 1.45)
· Nifty saw some short covering yesterday. Higher put addition and increasing PCR should give support from lower levels.
Outlook for 20 May, 2008:-
· Intraday support for the Sensex exists at 17300 below which correction towards 17050-17150 is not ruled out. But as long as we are above 17000, bullish stance should be maintained.
· BHEL (1795):- Buy with SL 1750 for target 1970-1990
· Amara Raja Batteries (194):- The stock is near good support of 182. Buy for target of 218-223.
FIIs are getting lowered returns because of appreciating Dollar vis-à-vis Indian Rupee. Dollar has grown around 7-8% against the local currency. It is like a small pinch for them. If we consider US economy, the Fed has already indicated that it may be done with the rate cuts. Now if they start raising the rates, the liquidity may flow back towards USA. It may or may not happen but is worth keeping in the back of our minds.

CMIE retains GDP growth forecast at 9.5%
Weakening Asian currencies trim $ returns for FIIs
Results Today (20 May):- Bank of Baroda, Bharat Forge, Dr Reddy, GMR Infra, GNFC, JK Cem, Mukand, RPG Cables, SCI, Suzlon, TTML

Disclaimer: These recommendations are based on the theory of technical analysis and personal observations. This does not claim for profit. I am not responsible for any losses made by traders. It is only the outlook of the market with reference to its previous performance. You are advised to take your position with your sense and judgment. I am trying to consider the fundamental validity of stocks as far as possible, but demand and supply affects it with vision variations.

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