Crude Near Breakout

WTI Crude ($81.69) is trading in a rectangle formation moving between $68 and $84 while $87 is current yearly high..... Download whole report http://www.4shared.com/document/0qouCSAb/Crude_Oil_showing_Breakout_011.html

Weekly Update 02 Oct, 2010 by Tanmay G Purohit

Nifty has closed the 5^th consecutive week higher with 125 point gain at 6143. CAP GOODS, METAL stocks were major gainers this week. SAIL rose 8.5% followed by HINDALCO, TATA STEEL, JINDAL STEEL which rose more than 5% each. BAJAJ AUTO rose nearly 7% this week as the stock came into Nifty-50 stocks. CAP GOODS gainers were SIEMENS and BHEL. OIL & GAS stocks retreated on profit-taking – BPCL -4.2%, ONGC -2.2%.

India's manufacturing sector continued to expand although at a considerably slower pace than in preceding months, predominantly weighed down by a fall in new orders and output. The HSBC Markit Purchasing Managers' Index, based on a survey of 500 companies, slid to 55.1 in September, which marks the lowest reading since November last year, from 57.2 in the August survey. Food inflation rose for the fifth straight week, climbing by almost 1 percentage point to 16.44% in the week ended September 18 on account of supply disruptions due to heavy rains and floods; food inflation had stood at 15.46% in the week ended September 11.

Weekly Technical View:

Nifty has closed higher for 5 consecutive weeks and trailing positions is the best approach for short-term traders. 6070 is important support for next week while 6000 is major psychological support now. 6357 is all time high for the Nifty and with current momentum that looks to be achieved soon. This has become a fast market and gains in intraday are very high, next important trigger would be Q2 results and INFOSYS is scheduled to announce results on 15 Oct. Nifty rally from 5348 to 6153 which has taken 22 trading days and has been very sharp so if any correction happens, that would also be equally violent; Nifty below 5850 only weakness can start, 20DMA 5861 which would be strong support on closing basis.

Support 5950/5880/5790 Resistance 6060/6180/6300

Sensex has closed the week higher by 500 points at 20445 and it nears probable channel resistance near 20950. In the last 22 trading sessions Sensex has never broken below 5-day lows and now that is 19864 which would become important support to keep short-term up trend alive.

Support 20240/19950/19800 Resistance 20529/20950/21200

 

Technical Call: FSL (Rs 28.80):- The stock trades in up channel on Daily graphs and on Friday it has closed above its 200DMA. Stock sustaining Rs 27 levels can rally towards Rs 31-32 levels.

Weekly Nifty Update 25 Sept, 2010 by Tanmay G Purohit

Nifty has closed the week higher for 4^th consecutive week by 133 points at 6018 and this is first time after 11 Jan 2008 that Nifty has closed the week above 6000. Longest stretch of weekly up closings this year was Feb'10 through Apr'10 where 9 consecutive weeks Nifty inched up when it rose 15% but current rally is very sharp as in these 4 weeks only nearly 13% rise has been witnessed. Gains this week were clearly led by FMCG stocks as BSE FMCG index rose more than 5% in last 5 sessions. HIND UNILVR was top gainer in Nifty with 11% gains followed by HDFC, RANBAXY, HERO HONDA, MARUTI, IDFC, ITC and WIPRO which rose more than 6% each. FINANTECH lost 13% this week as SEBI denied permission for MCX-SX, in Nifty CAIRN was top loser with 3.8% loss.

Foreign institutional investors (FIIs) have poured in over $2.67 billion in September alone, fuelling the rise of Indian stock markets. Till Sep 17, FIIs had invested over $2.64 in the markets and picked up $39.67 million worth of new securities, according to data available with the Securities and Exchange Board of India (SEBI). Rupee is becoming stronger due to high FIIs inflow and strong Rupee benefits Importers and Oil Companies HPCL, BPCL, IOC, MRPL, ESSAROIL benefit, any fall in global crude prices would add to benefits of these companies.

Ratings agency Crisil said it will buy US-based knowledge process outsourcing firm Pipal Research Corporation for $12.75 million and at present, FSL holds the majority stake in Pipal which will boost valuations of FSL forward and stock can target Rs 32-33 in short-term. On index basis, SBI and FMCG stocks look very strong to add to gains but RELIANCE and INFOSYS hold the key for short-term trend as these stocks can pressurize if they correct.

Technical View:

Nifty 6357 is all time high and that would be only important resistance to be crossed now. Euphoria is slowly building up in markets but so far only FIIs have been providing big liquidity with MFs remaining sustained sellers. Nifty as long as maintains 5900 correction would be hard to come in this settlement and if rally continues above 6000 we may get very close to all time highs very soon. Whenever Index cuts low of previous 5 days then correction may start in a big way now 5880 below only will trigger correction. As market rise is steep correction can be steeper so book regular profits and be stock-specific as gains in individual stocks are high.

Support-5950/5880/5790 Resistance-6060/6180/6300

Stocks looking good: FSL, ONMOBILE, INDIA CEM, NHPC, NTPC

Stocks looking weak: STER, BGR ENERGY

Is the Dollar Depreciating

Dollar Index is making bearish Head & Shoulders formation where below 79 it can target 76/74 levels. Actually H&S target could be 71.

Monthly Graph shows likely formation of symmetrical triangle and current leg may test 76.20 as probable support.

(Graph Source: NetDania)

The US Dollar Index is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies. It is a weighted geometric mean of the dollar's value compared only with

• Euro (EUR), 57.6% weight
• Japanese yen (JPY), 13.6% weight
• Pound sterling (GBP), 11.9% weight
• Canadian dollar (CAD), 9.1% weight
• Swedish krona (SEK), 4.2% weight and
• Swiss franc (CHF) 3.6% weight.

Comments welcome!

Weekly Nifty Update 18 Sept, 2010 by Tanmay G Purohit

Nifty has closed the week very strong +244 points at 5885 but Adv-Decline ratio has remained negative through the week in spite of Nifty moving higher as focus has clearly shifted to Large caps from Mid and Small Caps after strong IIP numbers last weekend. DLF, AXIS BANK, HDFC, ABB, SUN PHARMA, UNITECH, RELIANCE rose more than 7% each from Nifty while LIC HSG, CORPORATION BANK rose 11% this week to take Nifty Junior higher.

Indian top one hundred firms paid 381.07 billion rupees in advance taxes for July-Sept, a rise of 16.4 percent year-on-year, an official from the federal finance ministry said. Sectors like banking, finance and auto have done well while cement and pharma adv tax payments were down as compared to last year's numbers. Cement prices would go up in South by Rs 25-40 per 50kg bag despite low demand – Coal and Freight costs form nearly 50% cost of Cement production and both have gone up 20-30% in last one year as a result of which prices have been hiked.

RBI raised repo rate by 25bps and reverse repo rates by 50bps in its Monetary policy on Thursday and bankers have indicated that borrowing rates may soon rise. While talking about Economic Indicators in India, the RBI has voiced concern over the high volatility in the industrial production numbers, which is sure to bring greater focus on the integrity of data put out by Indian agencies as it comes within a month of an embarrassing mistake in first quarter GDP estimates.

Trade numbers for August - Trade deficit at 23-month high at $13.06Billion, exports up 22.5% to $16.64billion and  Imports jump 32.2% to $29.7 billion in August, trade gap during the April-August period stood at $56.62 billion.

US House passes 'Made in America' bill, the US House of Representatives passed two different bills that mandate the Congress and the Department of Homeland Security to purchase only US-made goods indicating U.S entering protection era. Indian cabinet cleared the way to allow commodities exchanges to launch options on Thursday, a move which should boost liquidity in markets which have already attracted international investors.

Technical View:

Nifty has neared 5900 very easily after breakout last week and now 6000 is next psychological level to test while Sensex would eye 20000.

Investors need to know that this market is becoming overvalued every day and Nifty P/E is at 24.61 while S&P CNX 500 P/E at 22.37. Markets can remain overvalued for a long time as long as liquidity is strong but once selling starts correction can be equally sharp. There are opportunities in any market so investors would do well accumulating stocks for long term - RELIANCE, NTPC, POWERGRID, GLENMARK, NHPC, ONMOBILE, MRPL, NEYVELILIG, RELINFRA, APIL are value buy for 3-4yrs long term investor who feel missed out can invest in monthly SIP basis.

Nifty hasn’t really corrected in the last 12 sessions and has risen nearly 9% in this period. In this fast rally Nifty has never broken previous day lows so traders can take benefit of this to keep intraday stops. For traders keeping 5790 as short-term stop loss is advisable while 5550 becomes very important intermediate term support.

Support-5790/5650/5575 Resistance-5925/6030/6170

Stocks looking good: PUNJ LLOYD, HIND OIL EXP, EKC

Stocks looking weak: HERO HONDA, CIPLA