Dear Investors
Monday, markets traded in a small rang bound movement on either side
large cap stocks remained static while there was good ‘Broad base’
move in different sectors. Though Nifty and sensex finished the day
in green it was a ‘Spring less trade’ with low volumes and some
volatility. There was buying in rate sensitive sectors like reality, banks
and Auto.ADAG stocks witnessed good buying while large caps like
ITC,NTPC,Tata steel, Land T and Hero Honda lost some ground. It was
agri commodity stocks like sugar, tea and coffee traded heavily with the
news of ‘Sugar decontrol’ and deficient tea and coffee crop. Volumes
were low but there was stock specific activity in number of mid and
small cap stocks
Data for the day
Indices
Open: 5679(18896)
High: 5679(18942)
Low: 5633(18781)
Close: 5650 (18814)
Advance Decline: 1766:1075
Turnover: 78,000cr.
Asian markets traded in green with good gains in Hang sang
And Shanghai composite
European markets traded flat to positive
Gold: 1494$/oz (21730/10gm)
Silver: 34.11$/oz (50417)
Crude: 95.02$/brl (4284)
$Index: 75.04
What next:
Monday was a day of ‘breather’ for large cap stocks but it was
good to see the spread in mid and small cap stocks indicating
retail activity. Traders and Investors will be waiting to see the
durability of the last few day’s rally before taking new positions.
Indices may consolidate in a range without shedding gains before
Making a new high. There are number of positive developments
Around the global and local markets which will keep the ‘Upward Bias’
continued while markets consolidate in a range.
All depends on fresh FII flows and retail participation in coming days.
also it will be Monsoon and Earning season which will be affecting
further course of market movement, till that it may ‘Cruise’ in a
positive ‘Range’ which will be decided by technicals.
Levels to watch
UPWARD: 5675(18910)/5700(19006)/5721(19071)
DOWNWARD: 5602(18684)/5580(18588)/5560(18540)
Technical View:
Pivot at:5654(18845)
Nifty is moving above all the short and medium term averages
Like
50 DMA @5519(18399)
100 DMA @5546 (18492)
200 Day Exponential average @ 5565(18548)
Indicating a strong upward bias in medium term period,
Nifty is facing stiff resistance at 5690/5710 range
with a selling above 5700, it looks markets may witness
a swift and short correction before making any decisive
move towards 200 DMA @5750(19150)
While correcting Nifty will have strong support @ 5560(18540)
and @5515(18400)
As long as Nifty is above 5480(18300) it will be in an ‘Upward Bias’
Market Strategy
-Buy all the dips up to 5515
-Keep 5480/5515 as ‘No trade zone’
-All long positions should have 5480 as stop loss
-No fresh shorts advised as long as Nifty is above 5515
-Exisitng shorts should have a stoploss @ 5583 and
A target @ 5515
-Fresh investment buying should be on hold till Nifty
Moves either above 5750 or falls below 5480.
Stock specific
R. Com@100
DLF @235
Hindalco@188
Sterlite@172
M &M @702
Hcl Tech@498
Bharti@384
Ranbaxy@530
Castrol@551
HDIL@166
Blue star @308
Sterlite Tech.@55
GMDC@155
CESC@300
Hexaware@73
Elecon Engg.@71
Jayashree Tea @168
Rajashree Sugar@49
Renuka Sugar@73
Tecpro systems@276
Talwalkars @250
V-Guard @224
EMCO@51
SPIC@31
Celestial Lab@30
Ador fontech@129
All the above trades should have a time span of 5 to 10 days
With a stop at 3 to 5% down or Nifty level of 5480
COMMENTS
Markets have made an ‘Initial Smart Move’towards 200DMA
at 5750. It requires new positive triggers to take out this and
move towards 5800 and then 5900.All depends on……..
-The result season starting with technology from 12th July and
Onwards
-Continuation of FII flows going forward and retail participation
-Progress and distribution of Monsoon in coming days
-Further policy actions from Government
These are the ‘Four Legs’ on which markets will be trying to
move towards new high, Failure of any one will damage the
market sentiment leading to a premature abortion of the rally.
Traders will be looking at ‘Earning season’ carefully as FII
participation will largely dependant on it,
While RBI will be watching…
progress of Monsoon keenly, as Inflation will be dependant on it.
Government policies will decide the fate of investment by FII
in India
So progression of the markets is dependant on local factors
While Global cues will be supportive to the initial thrust given by
Indian environment.
All in all, it looks that market will be in a ‘Wait and Watch’
mood before making a fresh move, which can be called as
‘Consolidation’,Rangbound’ or ‘Digestion phase’ by technical
And fundamental analysts, fact is that markets may not ‘Make
A Move’ before some clarity on all the above ‘Four Factors’
IMPRESSION
CONSOLIDATING
Thanks
Dr. Vasant Bele
All the views are personal, invest with caution and after
Consulting experts
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