CAUTION , EXUBERANCE and EUPHORIA(Choice is yours)

Dear Investors

After two months ups and downs on Monday markets

Reached the psychological level of 5700 , It was fifth

Consecutive day of up move in Indian stock market.

Nifty after touching 5709 closed at 5687, sensex too

Had crossed the 19000 mark to close at 18943

Monday’s Levels

Nifty: Open: 5654, High: 5709, Low: 5643, Close: 5687

Sensex: Open: 18799, High: 19024, Low: 18799, Close; 18943

VXI (Volatility Index) Open:20.4/High:21.8/Low:20.2/Close:21.0

What Next

 Indices have tested the important upper levels during the trade

To close at 200DMAs(Nifty:5688/Sx.18941) . This is a crucial

Period for markets. Last five trading sessions, especially last

Two sessions, have been too fast to ‘Digest’ it, hard to say that

We will move forward with the same ‘Zing’ without ‘Digesting’

The gains of Friday. Market may consolidate at lower levels of

5588(200 Day exponential Average) 5688(200 Day Simple

Moving average). Range or even at lower levels. The rise

In indices during last few sessions is, truly, not on sound

Fundamentals and looks like to be a 20-20 type of situation.

Now is the real Indo-Pak battle (Bulls and Bear).

One has to be very careful in creating fresh positions before

Markets test some lower support levels.

There are number of sensitive areas beyond 200DMA and they

May create selling pressure, Keep watch on 5699/5720/5760

And 5798 levels, these may prove to be supply zones for

Nifty .All positions after 200DMA should be with strict stop loss

Though there are chances that markets, after moving out of a

‘Solid consolidation, will try to scale higher levels of 5819/5880

It will face number of hurdles during the process.

Keep watch on

UPWARD: 5699/5720/5760

DOWNWARD: 5620/5588/5515

Technical View

Pivot For Nifty: 5679

R1 (First resistance) is @5716(19045)

R2 (Second resistance) is @ 5745(19147)

R3 (Third resistance) is @ 5782 (19270)

Significance

All the resistance levels are within the range of

5700/5800, indicating confluences of resistances

At every small rise, this indicates that it will be

Difficult for markets to go beyond 5790 levels in near

 Future.

Long traders are advised not to create fresh long at

Higher levels till Nifty takes out 5790 on closing basis

S1 (First support) is @5650(18820)

S2 (Second support) is @ 5613(18697)

S3 (Third support) is @ 5584(18595)

Significance

S3 (5584) Is placed nearer to the 200 Day exp. Average

Which should be a strong support for the going up move

Break below it will signify a change in undertone from

Up to down.

VXI (Volatility Index)

Pivot @ 21.04

Significance

As long as volatility Index remains in a range of 18-22

Nifty will be moving in an up trend any increased volatility

Beyond 22, towards 24-28 range should be looked up on

As change in trend

DMAs(Day Moving Average)

5DMA @5487(18239)

20DMA @ 5471(18238)

40DMA@ 5445(18167)

50DMA @ 5495(18331)

200DMA @5688(18950)

50 Day Exp. Ave. @ 5548(18498)

200 Day Exp. Ave. @5587(18630)

Significance

We are at the level of 200DMA, where there is likely to be

Lot of supply leading to fall in Nifty levels, Close beyond 200

DMA WITH VOLUMES FOR NEXT FEW SESSIONS, will be

Needed to confirm the continuation of ongoing up trend

And or beginning of a ‘Bull Market’.

All higher levels should be used to book part profits and

Dips to the levels of 5588 can be used to buy.

Any close below 5588/5515/5480 should act as a

Warning bell for long traders.

COMMENTS

The present rally was an effect of a long consolidation

 In a tight range, traders should look all the dips as an

Opportunity to buy, with a target of 5790, beyond which one

Should be watching the speed of the rally, It may not 

Sustainable for longer period and markets may drift back

To the support at 5588 level, if lower levels are achieved

In the course of a fall, traders should wind all the longs and

Wait for the sure trend to emerge.

The rise in markets during last few sessions looks

Like to be a technical one, than fundamental, because there

Is no change in fundamentals of India during last few days, so it

Should be taken with caution, no Euphoria and no Exuberant’

Positioning.

Stock Specifics

ICICI Bank

RIN

HUL

BOB

Canara Bank

L&T

Bahrti

Elgi Equipment

EMCO

Elecon Eng.

LIC Housing

GIC Housing Finance

Celestial Lab

Ador Fontech

Artson Eng

Orchd Chem.

Idea Cellula

IDBI Bank

UCO Bnak

Federal Bank

Lanco Infra

Depending on Nifty levels keep stop loss

IMPRESSIONS

FACING A  WALL , DIFFICULT TO BREAK

Thanks

Dr. Vasant Bele

All the views are personal, invest after consulting expert