Nifty Outlook for 28th May 2010

Yesterday, on the daily charts, NIFTY made a Long White Candlestick, signaling strength in the markets. NIFTY opened positively flat in the morning. Markets gained swiftly throughout the session and gained almost 90 points for the day. It was a Global rally led by China, as it denied the earlier statement made to sell its eurozone bonds held by it. All over the globe markets traded positively around with 2-3% gains, except China. NIFTY beautifully crossed all its intraday resistances and made a high of 5016.60 for the day. Apart from the Global Cues, other reason was the short covering observed due to the F&O Expiry.

Now, if for next 2-3 trading sessions if NIFTY closes above 5015, it may again enter in the positive territory again. As, yesterday NIFTY crossed its 20-Days EMA (Exponential Moving Average) of 5042.67.

Both the 20-Days EMA (Exponential Moving Average) and 50-Days SMA (Simple Moving Average) levels are acting as strong resistance levels for NIFTY. RSI (Relative Strength Index) and MACD (Moving Average Directional Index), are giving SELL signal along with the rising volumes, hence traders are suggested to trade cautiously by following Strict Stop Losses and avoid making fresh investments at this point of time.

For the day, intraday resistance for NIFTY comes at 5035 / 5075 / 5115 levels. At the same time, 4960 / 4935 / 4915 will act as major intraday support levels.

What does Indicators Say?

1. RSI (14 Days & 9 Days): The values are 45.39 and 38.56, respectively.
2. MACD (26 Days & 12 Days): Their Values are -78.38 and -64.65, respectively. a negative crossover is indicated by both the Moving Averages.
3. +DI: 19.81, -DI: 35.80, ADX: 32.53: The Negative Directional Index has gained strength over the Positive Directional Index and also the Average Directional Index is now above 20, indicating strength in the current trend.
4. SMA (50 Days) & EMA (20 Days): The values of these two indicators are 5191.61 and 5042.67. Both the Moving Averages are now acting as Strong Resistance levels for NIFTY.

Stocks in Focus:

ACC Sell at 809-810 for the Target of 765 & 730, with the Stop Loss of 890.

INDHOTEL Sell at 86-97 for the Target of 86, with the Stop Loss of 101.

ADANIENT Sell below 509 for the Target of 477, with the Stop Loss of 519.

LUPIN Sell below 1778 for the Target of 1740, with the Stop Loss of 1790.

AMBUJACEM Buy above 110 for the Target of 113 & 114, with the Stop Loss of 108.

ANDRABANK Buy above 130 for the Target of 133 & 135, with the Stop Loss of 128.

AXISBANK Buy above 1222 for the Target of 1245& 1254, with the Stop Loss of 1206.

BAJAJ-AUTO Buy above 2154 for the Target of 2168, with the Stop Loss of 2145.

LICHSGFIN Buy above 930 for the Target of 950, with the Stop Loss of 917.