Thumbs UP or Down ?

 

Dear Investors

Market started the trading with small gains and maintained a positive

 trade till FM started his ‘Budget Reading’ In early part of the second half

it appeared that budget is going to be a game changer leading to euphoric

buying and short covering led to soaring Nifty to day’s high at 5477.But

during last hour after budget ,Market did a ‘Summer Salt’ and  lost  the

early gains. Nifty closed just above previous close at 5333 leaving traders

guessing whether it is ‘Thumbs up or down’?

Days High/Low/ close

Open: 5330/ 17811

High:  5477/ 18297

Low:  5308/ 17719

Close: 5333/ 17823

What Next

The Nifty washed out more than 100 points from day's high as the fever

 of Union Budget 2011 was slowly vanishing. There were diversified but

cautious opinions regarding budget but, over all ‘Tone’ was a ‘Neutral or

 Harmless’ to market

Main question now is

a) Will this trigger fresh buying by FIIs / DIs / Retail Investors and Traders?

Leading to a fresh momentum to reach 200DMA at 5645

b) Will market pundits after dissecting, between the lines, come to a

 Conclusion the ‘Futileness’ of budget leading to nervous ness so that

Markets once again take a pre budget path and gravitate under the Pressure

 And Fears of Rate hike, Inflation and Geo political tensions and Oil prices

c) Market will move in a range of 5300/5500 to consolidate for some time

   till fresh event , either global or national, gives fresh impetus to move

   In new range, high or low,

All this will take some time, once the dust settles down markets will give

Some clues

Till that time one has to wait and carry on with technicals of the market

Watch the levels

Upward: 5402/5480/5515/5557

Downward: 5262/5200/5170/5115

Technical View

Pivot For Nifty: 5372

Significance

Pivot is above the close of last (28^th Feb.) trading day

Indicating its importance, if Nifty remains above that                      

It will attempt to test higher levels, any time in few sessions

R1 (First resistance) is @ 5437

R2 (Second resistance) is @ 5541

R3 (Third resistance) is @ 5606

Significance

The gap between R1 (5437) and last days high 5477 is very

Significant, Nifty may move above R1 but will face stiff

Resistance at 5477

R2 (5541) will be difficult to achieve as there are number of

Clusters of resistances like 5480/5515

Long traders are advised to book profits at 5515 and wait for

5557 to be crossed.

Short traders should create positions above 5437 with a stop at

5480 and carry trades till 5225/5200

S1 (First support) is @ 5268

S2 (Second support) is @ 5203

S3 (Third support) is @ 5099

Significance

For short term market is in positive bias so resistances are important

Than supports

S1 (5268) and last closing at 5333 should be treated as ‘No man’s land’

If Nifty trades below 5262 then fresh shorts can be created with a stop at

5380/5402

Any close below S2 (5203) will signal much lower levels like

5177/5115/5060

VXI (Volatility Index)

It was expected to be very active during the budget speech

It has been on rise for last trading sessions. Now as the events

 have gone by , it will reduce. If there is significant drop

in volatility markets will move in a range with breakout

on either sides

DMAs(Day Moving Average)

5DMA@5361
20DMA@5401
50DMA@5678
200DMA@5645
Significance

Market is trading below 5/20 DMA levels. Unless 20 DMA (5401)

Is crossed on ‘Closing’ basis markets will remain under bear pressure

Once 20DMA is crossed then short term trend becomes ‘positive’ and

Nifty may try to take further resistances at 5480/5515

For a complete turnaround Nifty has to cross 5603 and 200DMA at

5645

COMMENTS

Market participants were extremely cautious prior to the announcement of the

Budget, and feared a tough budget. The Finance Minister did not announce

 any new tax or duty, which along with a plan to contain rising inflation

and fiscal deficit, gave a reason to ‘Cover Shorts’ and/or buy fresh. This took

Nifty to rise 100 point, Nifty crossed 5400 and at one time reached above

Significant a level of 5450(5477). But as markets closed with minor gains

 The Nifty has not made the move very clear right now, it looked like it

 was about to start a nice intermediate uptrend for which it needs to cross

 200DMA (5645). It came within 150 points of it but it has done a 

'Summer Salt  back to 'Square One’   position, 

  

If one has to go by technical view Nifty may bounce back to move

Beyond 5600 within next month or so. Bear in mind , if we do make

A new low ,all the above analysis will go for toss. Traders are advised

To wait and watch for next few sessions till clear trend emerge

Till that time

The best strategy is

Use intra day momentum for trade

Have minimal exposure in a day

Book early profit or loss

Keep small targets and stop loss

Invest in large caps which have fallen by  

30to40% for long term in small trenches

Stock Specific

L&T                            Polaris

BHEL                         NIIT Tech.

ICICI Bank                 Glenmark

AXIS Bank                 ITC

BOB                           Crompton

CANARA Bank          Hindalco

Infosys                      Ranbaxy  

Crompton                  Sterlite

Bharti                        Maruti suzuki

 

Some of the companies can be considered for Investment buy

In small installments at every fall

GMR Infra                            Indusind Bank

 V-Guard                             Saw Pipe

Yes Bank                            Lanco infra

Ramkey Infra                      IDFC

Aditya Birla                         Sujana Towers

 EMCO                               Celestial Lab

Elecon Eng                         Arvind

Suryalata Spinning             Sintex Ind.                       

Sumeet Ind                        Ador Fontech

Artson Eng.                        Tutis Technology

Geodesic                           Techpro systems

Gateway Distripark        Camphor and allied

Impressions

Tere is really nothing much to be excited about in the budget –

which Is first reaction as well.It was a a passing event having

minimal effect on markets , for traders and investors most

satisfying thing is ‘It was harmless’

Nifty is at a crucial juncture now. What happens next is difficult

To predict at this time as it could go either ways from here. Long

Nifty looks in down trend while near term things look promissing

Thanks

Dr. Vasant Bele

All the views are personal. Invest after consulting experts

Back To The Wall ....( For Monday 28th Feb. 11)

Dear Investors

Background for the ‘Event’ (Union Budget)

Monday being the day of ‘Union Budget’ a vital event

It is after long time that markets are at very low levels

While going for Budget and there was no pre budget rally.

It has been argued ferociously that as there are no expectations

From this budget, there will be no ‘Disappointments’ and so

Market may go soft or flat. One thing is true that markets have

come off relentlessly during last few trading sessions.

There are very few long positions ‘Speculative or Cash’

But the fact is, there was very high ‘Delivery’ base selling during

Last week, and there were no buyers in the market against huge

Selling, indicating that Money has flown out of Indian equities.

FM: BACK TO THE WALL(in a tight spot)

Ground reality is that, Inflation, Increasing Rates, Increasing oil

Prices and Average performance by Indian Industrials has started

Threatening expected ‘Economic Growth’ along with ‘Recovery

In Developed’ economies, led to Flight of money out of India,

Pushing FM 'In a Tight Spot'

 ‘Fundamentally’ Indian economy is delicately poised. It has to

Be seen’, tomorrow, how FM steadies the ship. Till that time one

Has to go by Technical aspect of the market

Technical View

 Nifty has immediate resistance at 5300/5380 and only sustaining

Above it will move towards 5400. While immediate support is at

5170/5115 levels, closing below this will create panic once more,

Which will result in markets gravitating to a new range, 5060/4880

Historical Levels

 Historical chart for Nifty shows that we are at 5303, just above the line 3

Which is placed at 5170,  If Nifty falls to the line 3 and below, then there

 Are very weak supports above 5000 level? Any panic situation may lead

 To break 5000 taking Nifty to lower supports at 4880.
( See chart at the bottom)

Current Situation

Pivot for Nifty is at: 5291

R1 (First resistance) is @ 5350

R2 (Second resistance) is @ 5397

R3 (Third resistance0 is @ 5456

Significance

Any close below Pivot (5291) will be a bearish sign, one should keep

This as a significant level, as immediate stop loss for long positions

R1/R2 is the most important resistance levels for short term trend

For Nifty, if not sustained then, down trend will resume.

Bears can create short positions at R3 (5456) with a stop loss at 5515

S1 (First support) is @ 5244

S2 (Second support) is @ 5185

S3 (Third support) is @ 5138

In coming days the support levels are more significant than the

 Resistance levels because even without getting above resistances

 market can consolidate in  two resistance levels without breaking

supports.

Any violation of R2 (5185) will be opening doors for panic selling,

leading to lower levels. Maintaining S2(5185) is most important in

short term

VXI (Volatility Index0

Pivot Is at: 27.83

Volatility will be at its peak during the day, both before and after

Budget speech, all depends on the interpretations of the statements

by FM  

DMAs( Day Moving Average)

5DMA 5398

20DMA 5410

50DMA 5690

200 DMA 5644

5/20 DMAs are significant, as long as Nifty trades below these,

Short term trend will be bearish

Any close above 5600/ 5644 wills the game changer, which looks

Very difficult in near term

All the long positions should be protected with a stop below 5DMA

Bears can create fresh shorts above 20 DMA to be protected with a stop at

5515/5480

COMMENTS

It is advisable not to have large positions before ‘Budget Speech’ or

Should have strict stop loss at 5177

Long positions can be created in Infra Structure, Capital Goods,

and Banks, IT and FMCG

 You can afford to buy at higher levels, when ‘Trend’ becomes clear,

Than to buy and loose in 'uncharted territory'. So please wait for clear

Vision because ‘Market Is Not Going to Run in Hurry’.

NO STOCK SPECIFIS BEFORE BUDGET SPEECH

Impressions

Looks we are ‘Headed Low',post budget

 Read Weekly Report In separate blog'Balancing 

Thanks

Dr. Vasant Bele

All the views are personal, invest after consulting experts

                                                                                            

Balancing Act....(without support) (Weekly Report)

Dear Investors

Last week was, week of events, like Expiry, Economic Survey,

Railway Budget and Libyan crisis leading to oil rising to the mark

of 100$ per barrel. All this was responsible for catastrophic fall

in Indian stock market leading to ‘Fear and Flight’. There were spells

 of ‘pain and panic’ in traders and investors leading to very high

selling in cash and F&O positions. This brought Nifty to important

support level of 5200(Intraday day low of 5242).Nifty swinging in

300 points on concerns of oil prices, Inflation and Geopolitical

Tensions.Some respite was given by ‘Positive language’ of  ‘Economic

Survey’leading to cover some lost ground. Nifty  closed in green on

Friday at 5303.

NEXT  WEEK (28^th Feb.11 to 4^th March.11)

Monday is the day of ‘Union Budget’,  it has been written and said by

Number of Analysts and Expert’s, that there are ‘least Expectations’ from

This year’s budget. To me it looks like a ‘Pseudo Feeling’. On the background

Of Carnegie in last week there are ‘Great Expectations’  at ‘Subconscious’

Levels of every one related to ‘Economy’, ‘Stock Markets’And Indian as well as

 Overseas investors,

 only thing is,’Every body is playing a safe game by saying, that  ‘there are no

 Expectations’. But the fact is, there are……….

Like

GST/DTC Draft

Subsidiary Distribution

Oil and Gas Policy

FDI In retail

Tax Reforms

Spending On Infra structure

Fertilizer Policy …….etc

Everything is vital for

Growth or No growth

Inflation and Interest rates

Fiscal Deficit and GDP

And

Current account Defect

Finance minister has  to do a ‘Balancing Act’ between all these issues

 to keep economy growing with some speed. 

For  that matter a small bad Or some good news will make a lot of

 difference to Stock Markets’,Bond Market’ and also’ Currency Market’.

Stock markets are at a crucial border of  'Bear or Bullish’ zone

.Market participants are waiting for ‘Healing Touch’ of ‘Magician

Mukharjee’

Watch For

Levels like

5330/5380/5420 ON UPWARD DIRECTION, Nifty has to close above 5400

To show some hopes for ‘Bulls’. If Nifty manages to go beyond 5449 it will

be testing  5515/5557 levels . Even a small ‘Good News’ from budget will

help traders and speculators to take markets to higher levels

If Nifty does not sustain 5330/5380/5420 on upward journey it is likely to

Have first significant support at 5200/5170. Once Nifty falls below this

 Support then ‘Flood Gates’ will be open and next ranges will 5115/5060

And 4880 will not be impossible

COMMENTS

Traders and Investors should have small positions with strict stop loss on

Monday and next week. Even though markets bounce on Monday, the

ground realities ‘In land and globally’ are such, that it will be very difficult

 to Keep moving upward.

Once the euphoria of ‘Good News’ (If any) is over market will ‘Gravitate’ to

 Lower levels under the pressure of ‘Sentimental and Financial’ Damage

caused during last few days. So keep booking profits at all higher Levels till

5640 (200DMA)’ is taken out on closing basis

Traders are advised to have small positions with stoploss and minimum greed.

Investers (long term) should by in small installments at every fall below 5330.

Priority should be given to ‘large caps’ in Banking, Capital Goods, INFRA

STRUCTURE And  IT sectors. Auto, Pharma, Oil&Gas and Reality should be

 avoided for The time being.

.

Stocks to be considered are

L&T                          Polaris

BHEL                        NIIT Tech.

ICICI Bank                Glenmark

AXIS Bank                ITC

BOB                           Crompton

CANARA Bank         Hindalco

Infosys                        ACC

Guj. Ambuja

Some of the companies can be considered for Investment buy

In small installments at every fall

GMR Infra                    Indusind Bank

 V-Guard                       Saw Pipe

Yes Bank                      Lanco infra

Ramkey Infra               IDFC

Afutya Birla                 Sujana Towers

 EMCO                        Celestial Lab

Elecon Eng                   Arvind

Suryalata Spinning       Sintex Ind.                        

Sumeet Ind                   Ador Fontech

Artson Eng.                  Tutis Technology

IMPRESSION:

All is well as long as FM says ‘Do not worry  Be happy’

Or ‘Mai Hoo Na’!!!!!!!!!!!!

(Read 'Back To the Wall.. For Monday 28th Feb 11)

            Thnks

    Dr. Vasant Bele

  All the views are personal, invest after consulting experts

Drowned In OIL

  Dear  Investors

   It was 'HORROR  SHOW' on dalal street, concerns over Libya,
    Crude oil prices and Rising Food Inflation created panic in  market
    leading to 'Bloody Melt Down' of stock prices, the magnitude of sellin
 can be judged from cash market selling worth 2700 Crore Rupees in a day                                                 

                                                         

                                                          

 Nifty opened with small down gap and continued to fall till

afternoon. Moment crude prices touched 102$/barrel, Nifty started

 slipping fast and in a flash reached 5240 levels Creating shivers in

 the minds of traders and analysts. The speed, Breadth and volumes

Was  scary.At the end Nifty managed to close (above 5200) at 5262

. In doing so all the Fundamental and Technical ideas were washed

 out in sea of blood on dalal street, at the end only skeletons were

 remaining on the floor. Market breadth and Volumes were all

Time high and number of stock had fallen by 15 to 20%. There

 were no buyers on the street.

What Next

At present there is nothing but darkness and darkness, Only consoling

 thing for Paralyzed Bulls was, Nifty managed to close above

5200. Now the next immediate support is at

5177(Few weeks back low). Nifty may bounce back from this level

 one more time to scale up to the important resistance level of 5330

  All depends on

a)Global situation

     Libya and Neighbouring oil producing countries

     US Markets

     US Joless data

b) Railway budget

c) Fresh buying by FII(Foreign Institutional Investors)

    DII(Domestic Institutional Investors) and Skeletos

   Of Retail investors 

d)Crude prices

 Levels to Watch

 UPWARD: 5330/5380/5400

 DOWNWARD: 5180/5115/5060

Significance

 5180 is the level from where Nifty had bounced baco to reach

 5599. It is expected

‘If nothing untoward happens’ that Nifty will bounce from here to

test 5330, the first resistance

  If Nifty does not manage to scale higher levels and starts one

more down wave then

The immediate support is at 5515/ 5060. At least till budget Nifty

is expected to remain Above 5177. After that everything

depends on Union Budget

Technical View

Pivot For Nifty: 5309

R1 (First Resistance0 is @ 5376

R2 (Second resistance) is @ 5490

R3 (Third resistance) is @ 5557

Significance

In given situation Nifty has to cross R1 (5376) to keep hopes alive for

An upward move

R2/R3 looks difficult in such ‘Bruised’ conditions. For that the

 ’Magician’ Mr. Mukhrjee has to do lot of jugglery, which looks

difficult

S1 (First support) is @ 5195

S2 (Second support) is @ 5128

S3 (Third support0 is @ 5014

Significance

R1(5195) is the nearest level Nifty may test sometime

 during the day. If 5177 Is held till Monday then there is every

chance that even a ‘Neutral’ budget

Will arrest further fall in markets

Breach of 5177 will open flood gates for Nifty leading to a

totally new range

Of 5060/5115

All depends on how far PURCHASING IS DONE BY LONG

 TERM PLAYERS

VXI(Volatility Idex)

Pivot is at: 27.83

Significance

It is well above 24, and all the values of Resistanceare crossed

 on each day Indicating every day rise

After oil, this is the main ‘CULPRIT’ which has massacred the traders.

It was expected that expiry will cause volatile movements at the end but

It was not expected to such an extent

DMAs(Day Moving Averages)

5DMA@5429

20DMA@5420

50DMA@5702

200DMA@5642

Significance

Nifty has to cross 5DMA/20DMA to remain in up move or

 say avoid further fall.

There are remote chances that Nifty will be moving towards

 200DMA.

COMMENTS

All will not be well unless OIL stops boiling. There is every chance

That Nifty may bounce back on yesterdays over sold positions

But it has to be seen how far it sustains. Nifty may test 5330

And if maintains for some time will try to scale up to 5380/5400

Level. The railway budget will be significant from further course

Of  market at least for the day.

One thing is certain ‘Budget or No Budget’ it is very difficult for

Markets to recover the losses in near future, unless something

Drastic happens. The chances of such happening are remote

Every rise should be used to book positions by long traders.

Short sellers should keep stop loss at 5420 level.

Long term trend has changed te 'Bearish' one . One has to watch

levels'

5177 ,5115 and 5060 , 

If Nifty falls below 5060 then the new range will be 5014/4880

Stock specific

Do not take positions in stocks related to Railway, Like 

Texmaco

Kalindi Rail

T.Wagons etc

Adventurous traders and long term Investors can create long

positions in 

SBI

ICICI Bank

RIL

INFOSYS

HCL Tech

ITC

YES Bank

Ramkey Infra

GMR Infra

GVK Power

Mphasis

Polaris

Hercules Hoist

Arvind

Alok

Brand House

Suryalata Spinning

Wait for Pharma/ Capitol Good cos.till budget

IMPRESSIONS

Budget will be the last hope for 'Bulls'

Thanks

Dr. Vasant Bele

All the views are personal, invest with after consulting experts

.