Nifty Outlook for 04th January 2010 and Pre Market Calls

Yesterday, NIFTY made a Black Opening Marubozu Candlestick on the Daily Charts. After a long time, NIFTY witnessed a Gap up Opening of almost 30-40 points. Majority of the Index constituents opened strong in Green. AUTO Stocks opened strong in the green. Rally was further extended till the levels of 6178.55, especially by AUTO, METALS, REALTY & INFRA and MINING Stocks. However, till the first half of the Trading Session, profit booking was witnessed in the AUTO stocks. After the opening of the European Markets, METALS and MID CAP IT Stocks extended their rally. Overall, NIFTY didn’t move much for the day after witnessing a Gap up Opening. FERTILIZER, RAILWAY, SUGAR and TEXTILE Stocks also had a positive movement for the day. NIFTY made a low of 6147.20 for the day. Value Buying was witnessed in the beaten down REALTY & INFRA Stocks. For the day, NIFTY ended the session at 6157.60.

Net Buying of Rs. 340.97 Crore in Cash Segment and of Rs. 944.32 Crore in F&O Segment by FIIs was witnessed on Monday's Trading Session.

In F&O Segment Net Buying of Rs. 1323.32 Crore in Index Options, while, Net Selling was witnessed in Index Futures, Stock Futures and Stock Options of Rs. 81.81 Crore, Rs. 295.92 Crore and Rs. 1.27 Crore, respectively.     

NIFTY DEC FUTURE ended with the premium of 23.4 points to the Spot NIFTY.

Technically, NIFTY has formed a sort of Double Bottom Bullish Reversal Pattern, the breakout of which was given on Friday by closing above 6080 mark at the level of 6134.50. NIFTY has crossed its important resistance of 6080 successfully and is now expected to touch the life time high of 6338 soon. Now the level of 5960 is an important support level for NIFTY.

On the Economic Front, GERMANY will be coming out with its Unemployment Change for the month of December. M4 Money Supply and Mortgage Approvals for the month of November will be announced in UK. EUROPEAN MONETARY UNION will be coming out with its Consumer Price Index for the month of December. Factory Orders for the month of November, Total Vehicle Sales for the month of December, FOMC Minutes and ABC/Washington Post Consumer Confidence will be announced in US.

NIFTY is trading above both of its 20-Days EMA (Exponential Moving Average) and 50-Days SMA (Simple Moving Average) of 6014.77 and 6019.21, respectively. Even the distance between both the Moving Averages is now reducing, and if the short term moving average crosses the long term moving average from downside, it will prove to be a positive crossover between both the averages.  

MACD (Moving Average Convergence Divergence) is reverting from the oversold region and RSI (Relative Strength Index) has also reverted from the oversold zone. Investors are suggested to accumulate the BUDGET Driven Sectors Stocks like FERTILIZER, RAILWAY, METAL, CAPITAL GOODS, EDUCATION, etc. 

For the day, intraday resistance for NIFTY comes at 6180 / 6220 / 6250 levels. At the same time, 6145 / 6120 / 6090 will act as major intraday support levels.

What does Indicators Say?

1. RSI (14 Days & 9 Days): The values are 64.08 and 57.47, respectively, showing a negative crossover.
2. MACD (26 Days & 12 Days): Their Values are 36.15 and 7.24, respectively. a negative crossover is indicated by both the Moving Averages.
3. +DI: 29.13, -DI: 18.10, ADX: 18.33: 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 6019.21 and 6014.77. Both the Moving Averages are showing Negative Crossover.

Pre - Market Calls:

IVRCLINFRA   Buy only if it trades above 135 for the Targets of 140 & 142,with the strict Stop Loss of 133.60.

On the Daily Charts, IVRCLINFRA has made a Long White Candlestick with a good spurt in Volume. The stock successfully broke its Consolidation Zone by opening above the 128 mark. Yesterday, the stock made a high of 134.45 and closed at 133.90. The stock is now facing a small resistance at the level of 135. A good spurt in Volume was witnessed in the last hour of Trading Session yesterday in the stock, hence it is expected that the positive movement in the stock will continue on the next trading session too. The stock has moved above its 20-Days EMA (Exponential Moving Average) of 128.20 and the 50-Days SMA (Simple Moving Average) is quoting at 135.11, which if crossed will invite more buying in the stock. The 14-Days RSI (Relative Strength Index) is quoting at 57.16 on the Charts (RSI below 50 indicates weakness or confirms the Selling signal). The Positive Directional Index (21.07) is still below the Negative Directional Index (22.59), ADX (Average Directional Index) has gained strength on the Intraday Charts and is quoting at 34.58 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 IVRCLINFRA only if it trades above 135 for the Targets of 140 & 142, with the strict Stop Loss of 133.60. 

ASHOKLEY   Buy only if it trades above 67.20 for the Targets of 69.30 & 70,with the strict Stop Loss of 66.50.

On the Daily Charts, ASHOKLEY has made a White Opening Marubozu Candlestick, with an excellent spurt in volume. The volumes of the stock have also risen from the previous day’s volumes on Friday. The rising volumes in the stock suggest more upside in the coming days. The stock made a high of 67.15 and closed at 66.90 for the day. The stock has moved above its 20-Days EMA (Exponential Moving Average), which is a positive signal for it. The volume infusion in the stock in the last hour of Trading indicates that the positive movement in the stock will continue in the next trading session too. The 14-Days RSI (Relative Strength Index) is quoting at 48.77 on the Charts (RSI below 50 indicates weakness or confirms the Selling signal). The Positive Directional Index (17.46) is still below the Negative Directional Index (28.07), ADX (Average Directional Index) has gained strength on the Intraday Charts and is quoting at 55.40 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 ASHOKLEY only if it trades above 67.20 for the Targets of 69.30 & 70, with the strict Stop Loss of 66.50. 

GODREJIND   Buy only if it trades above 205 for the Targets of 212 & 214,with the strict Stop Loss of 202.

On the Daily Charts, GODREJIND has made a White Opening Marubozu Candlestick with a good spurt in Volume. Yesterday, the stock made a high of 205.45 and closed at 203.70. A good spurt in Volume was witnessed in the last hour of Trading Session yesterday in the stock, hence it is expected that the positive movement in the stock will continue on the next Trading Session too. The stock is trading above its 20-Days EMA (Exponential Moving Average) of 186.28 and has also crossed its 50-Days SMA (Simple Moving Average) of 198.72 by making a high of 205.45 and closing at 203.70 for the day. The 14-Days RSI (Relative Strength Index) is quoting at 65 on the Charts (RSI below 50 indicates weakness or confirms the Selling signal). The Positive Directional Index (29.95) is above the Negative Directional Index (17.47), ADX (Average Directional Index) has gained strength and is quoting at 33.48 on the Charts. ADX’s value aove 20 and near 40 indicates that the underlying trend is strengthening.  

Hence, it is recommended to buy GODREJIND only if it trades above 205 for the Targets of 212 & 214, with the strict Stop Loss of 202.