Nifty Outlook for 29th December 2010 and Pre Market Calls

Yesterday, NIFTY made a High Wave Candlestick Pattern on the Daily Charts. The pattern implies a loss of sense of direction and that there is a great amount of indecision in the market. NIFTY had a muted opening with the positive bias of almost 5-10 points. A very tepid session was again witnessed yesterday, with METAL stocks facing Profit Booking. Only MID CAP Stocks had positive movement for the day. It was a very sticky session, with NIFTY trading only in the range of 10 points up and down. Volume in the NSE Cash Segment was of only `8704.42 Crore (the lowest Trading Volume in the Year 2010). There was no Trigger for the markets to decide their direction further. For the day, NIFTY made a high of 6010.90, while a low of 5982.25. The session finally closed at the levels of 5996.00.

Net Buying of Rs. 109.03 Crore in Cash Segment and of Rs. 180.62 Crore in F&O Segment by FIIs was witnessed on Tuesday's Trading Session.

In F&O Segment Net Buying of Rs. 782.58 Crore in Index Options, while, Net Selling was witnessed in Index Futures, Stock Futures and Stock Options of Rs. 218.43 Crore, Rs. 374.66 Crore and Rs. 8.87 Crore, respectively.     

NIFTY DEC FUTURE ended with the premium of 20 points to the Spot NIFTY.

Technically, NIFTY bounced back, but with lack of buying interest and very sluggish volumes. NIFTY is now trading above its 20-days EMA (Exponential Moving Average) of 5964.15, but it was not able to cross the resistance of its 50-Days SMA (Simple Moving Average) of 6013.86 on the Closing Basis. Now the next resistances for NIFTY come at 6080 and 6100 levels, whereas the level of 5850 is acting as a Good Support Level.

On the Economic Front, JAPAN will be coming out with its Nomura/JMMA Manufacturing Purchasing Manager Index for the month of December. Consumer Price Index and Retail Sales for the month of December will be announced in GERMANY. EUROPEAN MONETARY UNION will be coming out with its M3 Money Supply for the month of November. MBA mortgage Applications will be announced in US.

NIFTY is trading above its 20-Days EMA (Exponential Moving Average) of 5964.15. Now the next resistance for NIFTY comes at its 50-Days SMA (Simple Moving Average) of 6013.86, which it was not even able to touch for the day. Both the Moving Averages are indicating a negative crossover, with short term moving average crossing the long term moving average from upside.

MACD (Moving Average Convergence Divergence) has entered into negative territory now. But at the same time, RSI (Relative Strength Index) reverted from the overbought zone. Brutal selling in BANKING stocks, which maintained the markets to life time high, indicates a very cautious approach to be followed while trading in the markets at this stage. Investors are also suggested to avoid making fresh investments at this stage.

For the day, intraday resistance for NIFTY comes at 6020 / 6050 / 6080 levels. At the same time, 5980 / 5945 / 5920 will act as major intraday support levels.

What does Indicators Say?

1. RSI (14 Days & 9 Days): The values are 52.60 and 51.28, respectively, showing a negative crossover.
2. MACD (26 Days & 12 Days): Their Values are 2.14 and -15.75, respectively. a negative crossover is indicated by both the Moving Averages.
3. +DI: 18.60, -DI: 21.78, ADX: 19.52: The Positive Directional Index has gained strength over the Negative Directional Index and also the Average Directional Index is above 20, indicating the development of strength in the current trend.
4. SMA (50 Days) & EMA (20 Days): The values of these two indicators are 6013.86 and 5964.15. Both the Moving Averages are showing Negative Crossover.

Pre - Market Calls:

EXIDEIND   Buy only if it trades above 169 for the Targets of 174 & 176,with the strict Stop Loss of 167.30.

On the Daily Charts, EXIDEIND has made a Long White Candlestick, with a slight spurt in volume. The stock had a positive movement for whole of the trading session. The Stock is trading above its 50-Days SMA (Simple Moving Average) of 162.82 and also moved above its 20-Days EMA (Exponential Moving Average) of 164.71 by making a high of 168.85 and closing at 167.80 for the day. The Stock is facing strong resistance at the levels of 169, which if crossed will invite more buying in the next trading session. The 14-Days RSI (Relative Strength Index) is quoting at 55.42 on the Charts (RSI below 50 indicates weakness or confirms the Selling signal). The Positive Directional Index (19.42) is still below the Negative Directional Index (21.07), ADX (Average Directional Index) has gained strength on the Intraday Charts and is quoting at 19.65 on the Daily Charts. ADX’s value above 20 and near 40 indicates that the underlying trend is strengthening.

Hence, it is recommended to buy EXIDEIND only if it trades above 169 for the Targets of 174 & 176, with the strict Stop Loss of 167.30.

HEXAWARE   Buy at the levels of 113-113.50 for the Targets of 117 & 119,with the strict Stop Loss of 112.30.

On the Daily Charts, HEXAWARE has made a Long White Candlestick, with a good spurt in volume. The stock had a positive movement for whole of the trading session. The Stock is trading above its 50-Days SMA (Simple Moving Average) and 20-Days EMA (Exponential Moving Average) of 92.53 and 101.82, respectively. The 14-Days RSI (Relative Strength Index) is quoting at 67.13 on the Charts (RSI below 50 indicates weakness or confirms the Selling signal). The Positive Directional Index (30.27) is above the Negative Directional Index (15.08), ADX (Average Directional Index) has gained strength and is quoting at 22.89 on the Charts. ADX’s value above 20 and near 40 indicates that the underlying trend is strengthening. 

Hence, it is recommended to buy HEXAWARE at the levels of 113-113.50 for the Targets of 117 & 119, with the strict Stop Loss of 112.30. 

HINDOILEXP   Buy 

at the levels of 223-224 for the Targets of 230 & 235,with the strict Stop Loss of 220.

 

On the Daily Charts, HINDOILEXP has made a Long White Candlestick, with an excellent spurt in volume. The stock had successfully crossed its range on the upside with a huge volume in only last hour of the trading session. Due to the spurt in Stock in the last hour of trade, it is expected that the positive movement will continue in the next trading session too. The stock crossed its 20-Days EMA (Exponential Moving Average) of 210.16 by making a high of 225.95 and closing at 223 for the day. The 50-Days SMA (Simple Moving Average) is quoting at 231.63. The 14-Days RSI (Relative Strength Index) is quoting at 55.67 on the Charts (RSI below 50 indicates weakness or confirms the Selling signal). The Positive Directional Index (26.71) is above the Negative Directional Index (22.21), ADX (Average Directional Index) has gained strength and is quoting at 26.65 on the Charts. ADX’s value above 20 and near 40 indicates that the underlying trend is strengthening.

Hence, it is recommended to buy HINDOILEXP at the levels of 223-224 for the Targets of 230 & 235, with the strict Stop Loss of 220.