Dear Investors
overhang of the RBI policy and below expectation earning
Continued on Thursday. Bears have tighten the grip on
Market and Bulls were ‘Screwed’ by falling valuations and
indices. Market started in a neutral tone with a high
Expectation of a ‘Pull back’ but within few minutes ‘Bulls
Were shaken by the precipitate fall of Nifty to the levels of
Near 5440(5443), Nifty marginally recovered to 5459. Nifty
Is at a crucial support at 5420 , it has to be seen how far
It remains intact.
Levels of the day:
Open: 5531(18448)
High: 5560(18569)
Low: 5443 (18160)
Close: 5459 (18210)
Advance: Decline: 1013:1646
What Next:
Market is poised at crucial level, all the factors governing
Market dynamics are against ‘Bulls’ like
Bad Technicals
Bad Fundamentals
Bad Earnings
This has led to a fragile sentiment in stock market to
Such an extent that even a small news or neutral
Earning is enough to cause a panic sell.
It was expected that from an oversold situation there will be
A decent ‘pull back’ to the levels of 5609, but it was a
Precipitate fall to the 5400 plus levels.
Nifty has gone in a lower trading range of 5400-5600.
As written in last blog dated 5th May 2011, Nifty is likely
To test the closing low on 11th Feb.2011, at 5310 if it does not
Sustain then the intra day low on the same day at 5177will be
Threatened. At least for the medium term, market has gone
In ‘Down trend’
Levels to watch
Upward: 5487 / 5531 / 5609
Downward: 5420 / 5380/5310
Technical View
PIVOT AT: 5487(18313)
Nifty is trading below all the moving averages like
5 Day Exponential @ 5580
200 Day Exponential @ 5611
Indicative of short term as well as medium term weakness
In market. Market has violated important support levels
Like 5515/5480 and has a stiff resistance at 5531/5604
Levels, on a pull back ,otherwise next down move will
Take markets to test 5177 level from where the present rally
Had started.
The important reference levels for Nifty are
HIGHS
Intra day top @ 6338 on 5th November 2010
Closing top @ 6312 on 5th November 2010
Closing intermediate top @ 6275 on 10th Nov. 2011
Lows
Intra day low @ 5177 on 11th Feb 2011
Closing low @ 5310 on 11th Feb. 2011
Watch
Resistance @ 5515/5575
Support @ 5412/5380
COMMENTS
In present rally market tested the level of 5998
And retraced back to today’s intra day low @
5443.
Now the real question is, where the present
Correction will stop 5310/ 5177?
No body is in a situation to predict because
Market is ‘Shaken’ by the speed of the fall.
And across the sector selling
There was a net out flow of around 4000cr. In cash market
Only, indicative of fresh FII selling.
There is heavy short built up in major large cap
Stocks like SBI, RIL, BHARTI ,ACC, TISCO…
If the fall continues for next few trading sessions then it will
Spread to Mid cap stock, setting a real panic selling
In market
There is no ‘Posetive Trigger’, in site , which can help market
To move upward, at least it should ‘Consolidate’
In a range, 5400-5600, till something like
Good Monsoon
Falling $ Index
(This is one of the most important parameter for FII
Flows, $ index is at a crucial level of 72.5 , it has a
Strong support at 71.2, if it is violated for two/three
Days then there will be shifting of ‘Money’ from Developed
Markets to Emerging markets , so watch $ index moves
Carefully)
Falling Commodity prices
Posetive Government policies
Will initiate fresh buying by cash rich FII/HNI/DII
And retailers , till that time better to remain away from markets
The ‘Theme’ ‘Buy weakness and sell Strength’ is no more
Applicable now, sell all the pull backs and remain cash rich
Is the mantra.
Stock Specific
Avoid
Banks
Autos
Cap Goods
Buy
RIL
COLAGATE
ITC
BHARTI
HCL TECH
Arvind
GMDC
Federal Mugal
Sterlite tech
Sharp Ind.
Dish TV
Persistant Syst.
Career Point
Talwalkars
IMPRESSION
Thanks
Dr. Vasnt Bele
All the views are personal, trade and invest with caution
And after consulting experts
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