Yesterday, NIFTY made a Small White Candlestick Pattern, continuing the previous day’s upside. NIFTY opened in the Red Territory with almost 15-20 points of downside triggered by weak global cues and made a low of 5507.80 for the day. But immediately after touching the low, markets tried to rebound, trading in a very narrow range. Nifty made a high of 5570.10 in the second half of trading session or say in the last hour of the session. It was a highly volatile session, wholly trading in Green. REALTY & INFRA, OIL & GAS and IT Sectors were the top gainers for the day, while CAPITAL GOODS and FMCG Sectors were the major loser for the day. NIFTY could not touch or cross its important resistance of 5580, but did not even breached the support of 5500 for whole of the session, which clearly indicates that the markets are still undecided about their further move and are waiting for a trigger to decide it. For the day, NIFTY closed at 5556.15.
Technically, NIFTY has completed the southward movement of Fibonnaci Retracement drawn from the High of 6338.50 (08th November, 2010) to the Low of 5177.70 (11th February, 2011). NIFTY has also completed another longer Extension Level drawn from the Low of 4786.45 (25th May, 2010) to the High of 6335.90 (08th November, 2010). Earlier, a Negative Crossover was witnessed between 200-Days SMA and 20-Days EMA. The Negative Crossover of 20-Days EMA (Exponential Moving Average) and the 50-Days SMA (Simple Moving Average) will now lead to more southward movement in NIFTY. On Friday, again 20-Days EMA played the role of a good support level and NIFTY closed just above the level, however breached it in intraday trading. Hence, now the level of 5650 is acting as a Short Term Resistance, for NIFTY, where the 50-Days SMA lies too, whereas the level of 5320 proved to be a Good Support. A technical bounce till the level of 5650 is expected in NIFTY, which will be supported by BANKING & FINANCE and REALTY & INFRA Sector Stocks.
On the Economic Front, JAPAN will be coming out with its Eco Watchers Survey and Outlook for the month of May and Q1 Gross Domestic Product. Current Account, Trade Balance and Industrial Production for the month of April will be announced in GERMANY. EUROPEAN MONETARY UNION will be coming out with its Q1 Gross Domestic Product. MBA Mortgage Applications will be announced in US.
Traders are suggested to trade cautiously by following Strict Stop Losses and Booking Fast Profits, whereas, Investors are suggested to make Fresh Investments at this point of time in the Markets in the stocks heavily beaten down with the Averaging Principle.
NIFTY moved much above its 20-Days EMA of 5521.65, but it is still trading below its 200-Days SMA and 50-Days SMA of 5757.67 and 5647.57, respectively. MACD (Moving Average Convergence Divergence) and RSI (Relative Strength Index) are signaling a short term northward move in the markets, due to the positive crossovers.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 51.87 and 48.39, respectively, showing a short term positive crossover.
2. MACD (26 Days & 12 Days): Their Values are -11.88 and -63.18, respectively. A short term positive crossover is indicated by both the Moving Averages.
3. +DI: 25.51, -DI: 21.55, ADX: 18.92: The Positivee Directional Index has gained strength over the Negative Directional Index and also the Average Directional Index is above 20, indicating that the market is in the trading range right now.
Some Trading Stats of the Tuesday’s (07th June, 2011) Trading Session:
Net Buying of Rs. 112.70 Crore in Cash, and of Rs. 317.62 Crore in F&O Segment by FIIs was witnessed on Tuesday’s Trading Session.
Net Selling of Rs. 132.55 Crore was witnessed in Proprietory Trades, whereas, Net Buying of Rs. 38.03 Crore and of Rs. 78.08 Crore was witnessed in Mutual Funds and Others Segment, respectively.
In F&O Segment Net Selling of Rs. 177.89 Crore in Stock Futures, whereas, Net Buying of Rs. 120.85 Crore, of Rs. 354.81 Core and of Rs. 19.85 Crore was witnessed in Index Futures, Index Options and Stock Options, respectively.
NIFTY JUN FUTURE ended at a Premium of 6.55 Points to NIFTY Spot.
A view on some of the NIFTY 50 Stocks for TOMORROW:
CIPLA: Can touch the levels of 345/348, if crosses the level of 338.
INFOSYSTCH: Can touch the levels of 2920/2930, if crosses the level of 2900.
SUNPHARMA: Can touch the levels of 500/502, if crosses the level of 491.
TCS: Can touch the levels of 1200/1210, if crosses the level of 1182.
FEDERALBNK: Buy only if it trades above 454 with the SL of 448 for the TGTs 464/468.
GLENMARK: Buy only if it trades above 315 with the SL of 311 for the TGTs of 322/325.
ABAN: Buy only if it trades above 585-586 with the SL of 578 for the TGTs of 598/605.
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