CALM after CARNAGE

Dear Investors

Today (Tuesday) market moved no where, it was a day of

‘Calm after two day’s Carnage’

Nifty moved in 50 points range, though it was in red all the day,

It managed to move in green at the end, probably due to covering

Of daily shorts. There were no great moves in any of the counters,

Volume was subdued and advance decline was in negative territory.

Indicating that traders are still under the effect of two days shock

Levels on Tuesday

Nifty: Open: 5716 / High: 5762 /Low: 5693 /Close: 5740

Sensex: Open: 19091 /High: 19201 /Low: 18976 / Close: 19099

What Next

Today markets tried to recover the losses of last two days

Normally after such a big fall there is a substantial, though

Weak’, ‘Pull back’, today it was not seen in the prices ,

In volume or in advance decline ratio.

This has created a suspicion about the close in ‘Green’

There is no conviction in market and the ‘pause’ is looked up on

As a precursor of INCOMING STORM. This has created

Nervousness in trader’s minds.

To call this as a correction In an ongoing rally Nifty must move

Above 5800 on closing basis

Levels To watch on Wednesday

Upward: 5786/5800/5850

Downward: 5709 /5660/5603

Technical view

Pivot at: 5731(19099)

Immediate resistance for Nifty is placed at 5770 and 5800

As long as Nifty does not move above 5800, on closing basis,

The possibility of further downside remains very high.

Any close above 5850 will signify that the fall was a

Correction in an up move

Closing below 5701 will be opening possibilities of

Moving in to a new downward channel of 5660-5570

RESISTANCE: It has first resistance close to the level of 5770

And  above this level the next resistance is seen near the 5859 mark.
SUPPORT: It has first support close to the level of 5695 and below

This level the next support is seen near 5660 mark.

VXI(Volatility Index)

Pivot at: 22.20

R1@22.90/R2@ 23.74 /R3 @ 24.44

Unless there is drop in volatility markets may not get in

To a stable range. Intra day increase in volatility is

Indicative of uncertainty. As there is rise towards 24 level

Nifty is likely to fall further, because as stated before VXI

And Nifty move in opposite directions.

DMAs(Day moving averages)

Nifty has closed above important DMAs like 200 DMA @

5726. 20 DMA @ 5718 and it is at 20 Day Expo. Average

@5743

This is significant but unless Nifty manages to close above

Short term DMAs like 5 Day Expo. Average @ 5786and 10

Day Expo average @ 5796 market in near term is vulnerable

To move in a downward direction. Support on lower levels is @

30DMA (5699) and 30Day Expo. Average (5643)

COMMENTS

Tuesday’s pull back was not satisfactory one on any of the

Parameters. It has to be seen if market remains in a range

Of 5724-5850 or breaks below 5700. All depends on the

Results of major industrials like TCS/RIL/L&T and others.

 Negative surprises will force markets to lower levels. Also the

Rollover of positions for expiry on 28^th is important for next

Move.

It is advised to be on side lines till a trend is emerges. Better

Not to trade in uncertain environment. All the trades should

Be small and with stop loss.

There is a high probability of Nifty getting drifted to the lower

Levels of 5660/5603 in coming days. There is no need to

Hurry for investment buying, you will get opportunities in

Coming days, so wait and watch is the right policy

GOOD NEWS ABOUT MONSOON IS TODAYS BRAKING

NEWS FOR BULLS let us see how market responds to it.

Market Strategy

Daily positions should be with stop loss

Early profit booking is the best way

Do not carry trading positions for next day

Go long above 5786 with a stop loss at 5700

Wait for fresh short creation till 5718 is broken

Go short below 5718 with a stop loss at 5818

Wait for long term buys till there is panic fall.

STOCK SPECIFIC

HCL Tech

Bharti

L&T

SCI @113 (Sl@ 102, Tgt:126/138)

Sumeet Ind @ 37 (Sl @ 30, Tgt:44/46)

NELCO @94(Sl@ 88 , Tgt 104/110)

India Glycol @131(Sl@ 121, Tgt:141/148)

UCO Bank@ 119 (Sl @ 108, Tgt:128/135)

Indbank Housing @20(Sl@ 19, Tgt:24/27)

GMDC@142(SL@ 133 , Tgt:148/158)

Polaris @202 (Sl @196 Tgt: 210/224)

IMPRESSION

LULL BEFORE THE STORM ?

(Direction indecisive)

Thanks

Dr. Vasant Bele

All the views are personal, invest after expert’s opinion