Smart Finish

Dear Investors

It was a ‘Smart Finish’ to the eventful week, Nifty has closed

 above 5600 to ‘Qualify’ for the ‘Final round’ of the ‘Race’, to

reach the target of 5700 plus. It was FMCG, IT, Metals,ADAG along

with some costruction cos.helped markets to get handsome gains

and finish expiry above 5600. Nifty and sensex ended the day in

positive territory with Nifty gaining 47 points and sensex152.

Data for the Day:

Indices

Open: 5614(18741)

High: 5657(18873)

Low: 5606(18723)

Close: 5647(18845)

Advances 1,532

Declines 1,368

Turnover: 1, 80,000 cr.

GOLD: 1502$/oz(21904?10gm)

SILVER: 34.81/oz(50955?kg)

CRUDE: 94.42$brl(4253)

$Index: 75.21

DOW: +152(12414)

S&P: +13(1320)

All the Asian markets were in Positive

And

Europe FTSE (Jun 30)5913.84 +57

              CAC  (Jun 30)3956.07 + 31

              DAX  (Jun 30)7335.38 +41

What Next:

Market started the day with a small gap up opening, it was

Expected to be volatile against the Expiry rollover situation,

But market just refused to go below 5600 and closed the

Day with ‘A smart rally’ to end beyond psychological level

Of 5630. This is very significant close for bulls, no doubt it was

Against the ‘Flurry’ of good news all round the world like.......

-Greece accepting the Austerity package

-US housing data registered encouraging number

-European markets registering more that 15 gains

-FII putting around 5000 corers during last few weeks,

All in all, the sentiment was boosted to have a flurry of

Trades in Large cap stocks, but the mid caps were laggard,

Causing some worry regarding the sustainability of the rise.

Now it has to be seen how far the momentum gets stretched,

Do we move beyond important technical levels? is the main

Question, so.........

Watch the levels

UPWARD: 5667(18904)/5718/19054)/5750(19160)

DOWNWARD:5606(18723)/5564(18547)/5480(18300)

Technical view:

Pivot at: 5636(18813)

-Nifty has closed above 200 Day Exponential average@ 5564(18547)

 Which is a significant development.

-Now it has to be seen if it can cross the 200DMA @ 5750(19160)

 To denote change in trend, in that process it will face

-Resistance @ 5667(18904)and 5687(18963) levels and the vital

 Level of 5710(19038),

-Support in case of a sell of will be @ 5564(200Day Expo. Average)

 And 5506(18700)

-To maintain up trend Nifty should not fall below 5480/5440(18300/18168)

 Levels.

Market strategy:

-Buy all the dips with a stop loss at 5480

-Do not short Nifty , can short individual stocks

-All shorts should have a stop loss at 5687

 5998/5710 should be treated as ‘No trade Zone’

-Book part profits at all higher levels , 5685/5710

-No investment buying as long as Nifty does not

 Close above 5750 for two trading sessions

Stock Specific:

TISCO@608/Target 635/Stoploss 590

M&M@703/Tgt:724/St:690

RIL@897/Tgt:924/St:880

ITC@202/tGT:221/St:192

NTPC@186/tGT:198/sT:182

DLF@210/tGT:224/sT:201

ICICI Bank@1087/Tgt:1110/St:1078

R.Com>@95/Tgt104/St:89

Sterlite@168/Tgt185/Stp:162

India Glycol@132/Tgt184/Stp:128

Sumeet Ind@36/Tgt:45/Stp:32

Ester Ind@45/Tgt:53/Stp:42

ACE@48/tGT:60/sTP@42

Lovable Lingeri@418/Tgt:460/Stp:386

Central Bank@123/Tgt:133/Stp:119

Repro India@145/Tgt:158/Stp;136

Fortis Health@161/Tgt:169/Stp:156

Sharp Ind @ all the dips

Pacific Ind.@172 and at all the dips

Ahalcon Parenterals@162/Tgt178/Stp:158

Artson Engg@42/Tgt52/Stp:38

Celestial Lab@32/tgt42/Stp:30

GMDC@152/tgt:168/Stp:146

LANCO infra@23

IDEA@79

All the trades should have appropriate stop loss at 3 to 5%

Lower levels and profits should be booked as we move

Towards the level of 5710 Nifty

COMMENTS

Indian markets have Bounced from a, equally, ‘hard fall’, which is always the

Case, it does not indicate that, it is due to the ‘Changed Fundamentals’

As, it is always said, that the rise in inflation or monthly numbers of auto cos.

Are ‘On a low base’, so is the case of indices, it is bouncing from a substantial

Fall in last few days to weeks, truly it has not gained quarter on quarter or

Week on week basis, the fall from the top was substantial to warrant

A handsome rebound( which was not coming) due to number of reasons.

 Even after this rise, we are just above the 200 Day Exponential average,

 And  200 Day Simple moving average is still far off at 5751

so lot of distance is to be covered to get ‘Euphoric’. we may get to the top

but there is lot of gap between 'lip and tip'.

As of now the real worry is can we ‘Sustain’ the rise? Without the

Support of  ‘Fundamentals’

Unless in coming quarters, growth numbers or industrials show positive

Signs of growth and increased bottom-line numbers we may not move

In a consistent up trend above 5750(200DMA) or  reach a fresh high , unless

Market takes away 5944 (recent top) 6257 (Intermediae top) and 6312

Or 6312/6338 (All time top) it will move in to corrective phases for some more

Time, which may be weeks or months

Though it looks that the Greece problem is averted, it is not solved

for ever there is lot of water to be flown under the bridge, even if

money supply is managed, unless there is some growth in industry

and economy during next few months, which looks difficult, all these

countries will fall back to the same trap and may  carry number of

Global economies  with them.

Even US economy is not out of woods, completely, the housing data,

Jobless claims and consumer confidence, are not encouraging. The QE2

Has increased asset prices but not the productivity of the industry, it has

Increased Inflationary pressures which might compel fed to raise rates

In due course of time.

This is applicable to Indian markets also, because we are moving

at higher levels on the backdrop of a single ‘Good news’ related to

oil, drop in oil prices and or Government action on oil and gas

rates, Still there are number of fundamental issues which are not

Supportive for a ‘turn around’ in economy. Like……..

-Inflationary pressure

-Possibility of RBI TIGHTNING leading to further rate hikes

-Margin compression of Industrial sector, leading to a weaker

 Bottom-line

-Growth slowing secondary to high cost of borrowing, high cost

 of labor and possible reduction in demand by consumers, leading to

slow down in production and rise in inventories and so on..

 -Lack of Government initiative in funding infrastructure projects.

All in all environments is not conducive for a sustainable rally in

Stock markets.

So one has to take last few days movement in market with caution.

FLAS NEWS; Cairn-Vedanta deal is through with some conditions

                        Main beneficiaries are ONGC and Vedanta

IMPRESSION

Puzzled!!!

Thanks

Dr. Vasant Bele

All the views are personal, Invest with caution and

After consulting experts. I and my relations may be

Interested in stocks suggested

Extended Gains

Dear Friends

On Tuesday market started with significant gains but as trade

Proceeded volatility took Nifty to lower levels below 5500.But

With the help of Financials, Capital Good, Power ,Auto and

Telecom sector markets ‘Extended the Gains’ to close above

At 5545, a good 18 points up. Though broader market was flat

Large caps like HDFC Bank,Kotak Bank,ONGC,Bharti,L&T,

BHEL helped markets to move closer to the resistance level

Of 5550. Advance decline was leveled while turnover was

High. Sensex gained 80 points to close above 18400

Data for the day:

Indices;

Open: 5548(18493)

High: 5558(18527)

Low: 5496(18323)

Close: 5545(18492)

Advance: Decline: 1493:1399

Turnover: 1, 77,000 cr.

Gold: 1500$/oz(22089/10gm)

Silver: 33.64$/oz(50615/kg)

Crude: 92.86$/brl

$ Index: 75.65

Dow: +145(12188)

S&P: +16(1296)

Global markets were positive, with Europe scaling

More that one percent in all the three major Indices,

CAC, DAX and FTSE.

What Next:

Within last few trading sessions markets have made significant

Moves on the back drop of falling crude and Government’s

Decision on Oil and Gas prices. It is worth getting some breather

And consolidate for few trading sessions before Nifty makes a

New fresh move. As we are nearing expiry on Thursday market

May exhibit volatile trades on either side. As long as this series

Ends above 5500 markets will remain in a ‘Positive Bias’. Market

Has signaled that Lot of ‘Bad Triggers’ are already played’ in

Currant valuations and still it is in an up move. For a significant

Change in the trend Nifty has to ‘Overcome’ certain technical

Hurdles or remain well above the support levels

Levels to watch

UPWARD: 5570(18571)/5584(18607)/5620(18700)

DOWNWARD: 5505(18345)/5470(18240)/5440(18160)

Technical View:

Pivot at: 5533(18447)

-Nifty has closed above all the short term moving averages

 Especially

50 Day Exponential @ 5505 and 60 Day exponential @ 5521

-This is in itself a bullish sign for medium term period.

-Now to keep the momentum floating in near term Nifty has

To cross the Moving averages between 70 and 200, exponential

Placed in the range of 5558(18527), 90 DMA, and 5568(18600),

200 Day Exponential average.

-Nifty may face selling pressure at vital resistance levels of

5584(18607) and 5598(18660), close above 5610 will be a

Trend setter in near term, one has to be careful in positioning

-Beyond 5600 as Nifty may correct from here to the support

 Like,

5505(18345), 5480(18300) and 5440(18160)

-To remain in an up ward bias Nifty should remain above

5420/5380 levels.

Market strategy;

-Buy all the dips up to 5440

-Book profits at higher levels beyond 5571

-All longs should have a stop of 5420 and a near term

 Target of 5598

-Avoid shorts at this level

-All shorts, existing, should have a stop loss of 5571

 5584-5610 should be treated as ‘No trade zone’

-Wait for investment buying till markets get stabilized

 In a range.

Stock Specific:

HINDALCO

STERLITE

L&T

ICICI Bank

Kotak Bank

NTPC

ONGC

Bharti

Ranbaxy

Cipla

HUL

M&M

Jain Irrigation@ 170           Piramal Life@ 90

Sintex@173                        Page Ind.@1828

Tainwala Chem @36          Summet Ind@ 37

Exide@ 167                        BANCO Product @70

Federal Mugal@254           Sahyadri Ind.@54

Raymond @ 254                 Talwalkar@254

Pacific Ind.@177                  GMR @33

Hercules Hoist @236

All trades should have stop loss at 3/5% lower level

Or Nifty level of 5440

COMMENTS

After three successive days rally markets have reached to

A significant level of 5500 and above. Market have gained

around 350 Nifty points in few trading sessions. This indicate

the change in sentiment. This rally is broad base and with

FII and DII participation, there is substantial cash base, fresh,

buying and good amount of short covering. Tomorrow being

Expiry day markets will be volatile today and tomorrow. It

looks that, we will close the expiry above 5500 or even

nearer to 5600, If so, then July will be a strong month.

If Nifty moves beyond 5600 on the back of, Greece austerity

Going through, US positive data, Good monsoon and some

Positive steps by Indian Government then the mood will be

Changed and 5200 low can be taken as bottom and then the

range will shift higher, 5350-5600, and any further trigger,

will change the gear of the market towards 5700/5750 level

Which is 200 DMA. Which  will qualify for change in trend.

All these ‘Ifs and Buts’ have some sharp ‘Edges’ like

-Inflation

-July RBI policy measures, rate hike and Growth projection

-We will start June result season, where companies will

 Be under margin pressure and slowing of growth

-Greece problem getting extension and

-US slow down on the back drop of termination of QE2

But at the same time

-Easing crude prices

-Easing Commodity prices

AND

-Good monsoon along with

-End of Government Apathy on policy front and falling

 Crude prices with diesel de regulation, if it occurs,

May counter balance all the negatives, to propel Indian

Markets to higher levels or get consolidated in a higher

Range before moving beyond 5600.

So as far as next few days are concerned one should

Hope to see that the on going correction is halted and

Markets prepare for the next up move.

Investors and traders can hope to see, End of the DRAUGHT’

As far as liquidity, across the border is concerned.

All this may look like a ‘fairy tell’ for the Investors and traders

Who are bleeding with last few days to months trauma, but

Folks,” That is Stock market” It can change its colures faster

Than a lizard (Sarda)

 Hope it will not be ‘too early’ for the ‘Bulls to Dream’ rosy

Days ahead

IMPRESSION

ENTHUSED

Thanks

Dr. Vasant Bele

All the views are personal, invest with caution and

After consulting experts

(Bulls) 'Relay Rally'

Dear Investors

On Monday market ‘Relayed’ the rally, started two days back

 on third successive day to move Nifty beyond 5500

 It was supported by

Oil and Gas primarily along with Capital Goods, Banking and

To some extent by IT majors. Declining crude prices and

Indian Governments decision on Oil and Gas policy lifted

The sentiment of traders and investors to take markets at

 Markets beyond 5550(18400) and to close at 5526 with very

 Good volume and high turnover

Data for the day

Indices

Open: 5441(18132)

High: 5552(18494)

Low: 5434(18132)

Close: 5526(18412)

Advance Decline: 1654:1216

Turnover: 1, 77,000 cr

Gold: 1501$/ox (22084/10gm)

Silver: 33.58$/oz (50549/kg)

Crude: 90.6$/brl

Dow: +108(12042)

S&P: +11(1280)

Asian and European markets were mixed

Nikkei closed marginally green while Hang Sang in red

FTSE in green and DAX in red

What Next:

It was Government’s one step forward on policy front, boosted

The sentiment in market. Nifty has moves beyond 5500 and

Maintained the level on closing basis. This is a good sign for

Markets to ‘Relay’ further to important psychological level of

5600. FIIs and Mutual Funds were net buyers for last three

Days. Global markets are stable and there is no negative

News except some restructuring of ‘Cairn- Vedanta’ deal.

In such scenario it is interesting to see how far this ‘Relay’

Succeeds to move towards main short term target of 5600.

Levels to watch

UPWARD: 5563(18544)/5598(18960)/5620(18700)

DOWNWARD: 5503(18330)/5456(18198)/5380(17980)

Technical View:

Pivot at; 5504(18346)

-Nifty has closed beyond short term moving averages like

 5 Exponential average@ 5456 and 20DMA @ 5458 and

50 Day Exponential average @ 5503

This indicates that the short to medium term trend has

Turned in to Positive,

-The next resistance will be @ 5539/18470(100DMA) and

5563/18560 which is 200 Day Exponential moving average.

-Once Nifty closes beyond this then the next stop will be at

 A vital psychological barrier of 5603/ 5622(18700). Nifty

May face selling pressure around these levels and fall back

-To the support levels of

5503(18300) 5480(18198)

-To maintain the current rally Nifty must not fall below 5478

 And 5450(18168)

 5450 will be important level to watch as a downside support.

Market Strategy:

-Carry existing long positions with a stop at 5478 and a

 Target of 5603

-Fresh long positions can be created at all dips with a stop

 At 5480

-Buy all the dips up to 5450 with a stop at 5420/5380

-No trades should be initiated on long side between  in a

 Zone of 5603-5622. Treat this as ‘No trade Zone’

-Cover all shorts if Nifty moves beyond 5526 after first

 Half an hour

-Fresh shorts should be avoided as long as Nifty is above

 5503/5480 levels

-Fresh shorts can be created once Nifty is above 5598

 With a stop loss of 5530

Stock Specific:

RIL

Axis Bank

ICICI Bank

Colgate

Power Grid

Ranbaxy

L&T

Sterlite

Hindalco

M&M

Maruti

HDIL@157              PFC@183

E. Kanto@85           Gati @61

Fortis @156             Ador Fontech@121

ACE@47                  Tata Motor DVR@532

Uni phos @154        BOSCH @ 6900

Central Bank@119   Federal Bank@449

Talwalkars@249       Lovable Lingeri@289

Hind Zinc@133         IPCA Lab@328

Blue star @298         Delta corp @96

Keep a stop loss 3 to 5% down or at Nifty level of 5440

COMMENTS

Monday’s move in market has given some relief to the

Traders and investors, it looks like 5200 is acting

As a strong support to the market in near future. Unless

Some thing drastically changes ‘Globally or Locally’

This expiry on Thursday may see a close above 5600.

All depends on how far FII and Domestic institutions

Put their money in cash market.

As stated in Monday’s blog , ‘Nothing has Cahnged’Fundamentally

Drastically so as reverse the trend from bearish correction

To bullish up move. One can say that there is a change in the

Intentions of India Government, but change in intention should

Get converted in to ‘Action’ on policy front.

Near term RBI policy, Monsoon and Policy decisions will decide

The trend of markets and Growth projections. Global Effect is

Getting cooled along with Oil and Commodity prices.Greece is

Trying to settle and US markets are waiting for the data.

All in all,as written in last Blog

Traders are advised to take the advantage of the changed

Situation but with A ‘Pinch of Sault’ and be ‘Cautiously Optimistic’

Than to be Euphoric.

IMPRESSION

RELIEVED

Thanks

Dr. Vasant Bele

All the views are personal, invest with caution and after

Consulting experts

Fast and Fierce (Rally)

                                                            Monday 27th June11

Dear Investors

Market was waiting for a small trigger to push itself  in an

Upward momentum. Positive global news, Greece bail out,

Fall in crude prices and Meeting of EGoM(Empowered Group

Of Ministers) for policy decision on Oil prices, were more than to

Enough for a ‘Thumping Recovery’ from weekly low of 5196

On last Monday.

As stated in last blog, real pull back from a 500 points (Nifty)

 fall over a period of time needs to be at least 100/150 points

 of Nifty.

Friday’s rally has surprised every participant in markets. Week

Had started with an intra day low of 5196 and Nifty moved

In a range of 5240/5330 all through the week till Friday. Market

Analysts never expected the ‘Turnaround’ so fast and fierce.

Nifty gained 151 points to close above important resistance of

5450 at 5471, so also sensex gained 513 points to close above

18000 at 18240

All sectoral indices were in green and volumes were very high.

 Data for the Day

Indices

Open: 5343(17804)

High: 5477(18268)

Low: 5343(17804)

Close: 5471(18240)

Advance Decline: 1984:852

Turnover: 2, 15,000 cr

Gold: 1502$/oz (22194/10gm)

Silver: 34.64$/oz (51857/kg)

Crude: 91.2$/brl

Dow: -115(11934)

S&P:-15(1268)

Most of the global markets were in green or flat

What Next:

As expected, a small trigger was required to corner the Bears,

It was not coming, at last the Global and Local news

Supplied the necessary fuel to move markets to some

Respectable level. Looking at volumes, it is not only the

‘short covering’ which is responsible for the rally but data

Indicates that there is addition of substantial long positions.

This is most encouraging.

 All depends on how far this rally gets stretched or it becomes

a day event only.

Volumes and buying by FII suggests that it is a sustainable

Rally, still one can not afford to be ‘Complacent’, but has to be

‘Cautiously Optimistic’, as long as certain ‘Fundamental’

Hurdles are in the way and Technicals does not suggest

that we are out of ‘Corrective’ phase, one should take this

rally with a ‘Pinch of Sault’ and watch the developments

around India and Inside India, take a technical support

 for positioning in during coming week

Next week is the ‘Expiry on Thursday’ so it can increase

the volatility to great extent

Levels to watch

UPWARD: 5499(18300)/5517(18404)/5569(18547)

DOWNWARD: 5420(18080)/5380(17888)/5310(17728)

Technical View

Pivot at: 5430(18104)

Nifty has closed above 5DMA @ 5299(17463) and

5 Day Exponential average @ 5369(17463), indicating

A positive bias in near term

Nifty has closed above 10 DMA(5381) and 20DMA(5455)

In coming week it will face

Resistance @ 5515(18388) and 5569(18497) which is

100 DMA and 200 Day Exponential average.

Once Nifty breaks above these levels it can move

Towards 5601/5630 levels where it will face stiff resistance

And profit booking

The support levels for Nifty are

5420/5380 AND 5310 If Nifty moves below 5310(17770)

It will slide to the recent low of 5196 and 5177(17296).

Any close below 5328 should be taken as resumption

Of down trend.

Market Strategy:

-Avoid going short at given levels

-All existing longs should have stop loss at 5380

-Fresh long positions can be created up to 5420 or

  Above 5517 with a target of 5568 and a stop at 5380

-No long term buying is advised at this stage because

 Market is in no man’s land zone

-All positions should be covered before expiry

Stock Specific:

RIL

ONGC

INFOSYS

HCL Tech

Hindalco

L&T

Ranbaxy

R.Com

SBI

ARSS@445                     KFA@39

Patel Engg.@140             Pacific Ind.@177

Spice Jet@32                   Punj Lloyed@65

Praj@71                           Sumeet Ind.@36

Essar Port@98                 Celestial Lab@32

HDIL@161                       Parsvanath@45

Tilaknagr Ind@40            SPIC@28

Arvind@75                       Talwalkar@255

Lovable Lineri@286          Tecpro @245

Sujana Tower@39            Ind swift lab.@92

Yes Bank@298                 Indusind Bank@266

Ramkey Infra@260

COMMENTS

Next week will be the week of ‘Make or Break’ for Indian’ as

Well as Global Markets. There are number of events taking

Place which can affect Indian markets to great extent.

Like

Government Actions:

Even though Indian Government has taken one step forward

On policy front it is a very small step, Government has to work

Hard on number of issues like……….

 Inflation

 Interest Rates

 Growth

 Capital Expenditure on Infrastructure

 FDI In retail, Banking reforms

 And

Expiry on Thursday

On Global front:

-Even though ‘Greece bail out’ has been accepted, long term

  Problem is far from over and may surface at any moment.

-As far as US is concerned what after QE2 a big question is.

  Will US economy move forward without further stimulus?

  What will happen to Commodity Prices?

  QE2 had helped raisin equity prices and Liquidity in system.

  What will happen to Interest Rates?

 -US economic data

  ISM Manufacturing number data on Friday

  Monthly Auto sales

  Consumer spending data and consumer confidence Index.

  Pending Home sells data

  Weekly jobless claim and PMI on Thursday

  Are important for US, and Global markets.

  All in all nothing has changed drastically, in a day, so as to think

  that we are out of woods

 One has to keep watch on developments around the world

  Before making long term commitments.

IMPRESSION

EUPHORIC

Read Next weeks market commentary as a separate article

Thanks

Dr.Vasant Bele

All the views are personal, invest with caution and after

Consulting experts