Nifty Outlook for 30th January 2012

On Friday, NIFTY made a Bearish Dragonfly Doji Candlestick Pattern. Confirmation of the suggested trend reversal by either a black candlestick, a large gap down or a by a lower close on the next trading day is strongly suggested. The market had a good start owing to positive Asian cues. Despite several attempts by bears to push down values during late morning trade, displaying volatility, bulls ultimately prevailed throughout the session. NIFTY marked a high of 5217.00 for the day. OIL & GAS sector was the biggest gainer for the day, while REALTY & INFRA witnessed a profit booking session, due to which it turned out to be the biggest loser for the day. NIFTY marked a low of 5162.40 for the day. The level of 5150 was acting as a good support for it. Finally, NIFTY ended at 5204.70 for the day, but could not sustain above the levels of 5220, even could not touch it.

Technically, a Negative Crossover between 200-Days SMA (Simple Moving Average) and 50-Days SMA is still intact. For the day, NIFTY however marked a high of 5217.00, and crossed the 200-Days SMA of 5204.92 too, but it closed below it at 5204.70. The level of 200-Days SMA also acts as a very good resistance for NIFTY on the closing basis right now. A Fibonnaci Retracement Level is being drawn from the High of 6338.50 (08^th November, 2010) to the 28-Months Low marked 4531.15 by NIFTY (21^st December, 2011). Now, the level of 5220.56 (50.00% Level of Retracement) is the next resistance level to be tested by NIFTY, the 200-Days SMA of 5208.32 also lies at the same point. The levels of 4957.07 (61.80% Level of Retracement) will now act as the immediate Support Level for NIFTY. Investors are suggested to avoid the markets to invest at this time; however, traders are suggested to take the advantage of Swing Trading, which will appear many times in between.   

On the Economic Front, JAPAN will be coming out with its Overall Household Spending, Unemployment Rate and Industrial Production for the month of December and Nomura / JMMA Manufacturing Purchasing Manager Index for the month of January. Retail Sales for the month of December and Consumer Price Index for the month of January will be announced in GERMANY. U.S. will be coming out with its Personal Consumption Expenditures and Personal Income for the month of December.

Q3 FY12 Results Season has commenced in India. Some of the important results to be announced tomorrow are of 3MINDIA, AJMERA REALTY, ALBK, BALRAMCHIN, EID PARRY, GHCL, GLENMARK, GMDC, HAVELLS, INDIABULLS FINANCE, INDIAN BANK, INGERSOLL RAND, KANSAI NEROLAC, LICHSGFIN, MAHINDRA LIFESPACE, MCLEODRUSS, NFL, NOVARTIS, ORIENTAL BANK, SHREE RAMA MULTI, UNIENTER and UNIPHOS.

Traders are suggested to trade cautiously by following Strict Stop Losses and Booking Fast Profits, whereas, Investors are suggested to take advantage of this short term move, which may pay off excellent returns.

NIFTY has crossed its 20-Days EMA (Exponential Moving Average) and 50-Days SMA (Simple Moving Average) of 4830.82 and 4952.02, respectively on the closing basis, but it is still trading below its 200-Days SMA of 5204.92. The 14-Days RSI (Relative Strength Index) and 26-Days MACD (Moving Average Convergence and Divergence) are now heading towards the overbought zone.

What does Indicators Say?

                                       

1. RSI (14 Days & 9 Days): The values are 75.89 and 68.08, respectively. The indicator is moving towards oversold zone from the overbought zone. 

2. MACD (26 Days & 12 Days): Their Values are 143.74 and 95.30, respectively. A short term negative crossover is indicated by both the Moving Averages.

3. +DI: 41.26, -DI: 14.46, ADX: 21.35: The Positive Directional Index has gained strength over the Negative Directional Index and the Average Directional Index is below 20, indicates that the market is in the trading range.

4. SMA (200 Days), SMA (50 Days) & EMA (20 Days): NIFTY has crossed its 20-Days EMA (Exponential Moving Average) and 50-Days SMA (Simple Moving Average) of 4830.82 and 4952.02, respectively on the closing basis, but it is still trading below its 200-Days SMA of 5204.92. 

Some Trading Stats of the Friday’s (27^th January, 2012) Trading Session:

Net Buying of Rs. 1240.16 Crore in Cash and of Rs. 1179.19 Crore in F&O Segment by FIIs was witnessed on Friday’s Trading Session.

In F&O Segment Net Buying of Rs. 164.72 Crore, of Rs. 521.18 Crore and of Rs. 522.16 Crore was witnessed in Index Futures, Index Options and Stock Futures, respectively, whereas, Net Selling of Rs. 28.87 Crore was witnessed in Stock Options.  

NIFTY FEB FUTURE ended at a Premium of 8.10 Points to the Spot NIFTY.

A view on some of the NIFTY 50 Stocks for TOMORROW:

ACC:                Can touch the levels of 1220/1230, if crosses the level of 1195.

INFY:                Can touch the levels of 2760/2770, if crosses the level of 2735.

RELIANCE:        Can touch the levels of 835/840, if crosses the level of 822.

SAIL:                Can touch the levels of 109/111, if crosses the level of 106.

SESAGOA:        Can touch the levels of 220/222, if crosses the level of 216.

STER:               Can touch the levels of 123/125, if crosses the level of 121.

AXISBANK:        Can dip to the levels of 1055/1045, if breaches the level of 1080.

BHEL:               Can dip to the levels of 266/262, if breaches the level of 272.

DLF:                 Can dip to the levels of 208/206, if breaches the level of 212.

JINDALSTEL:     Can dip to the levels of 616/612, if breaches the level of 628.

JPASSOCIAT:    Can dip to the levels of 69.60/68.90, if breaches the level of 71.60.

Pre Market Call:

FORTIS: Buy ONLY IF IT TRADES ABOVE 106 for the TARGETS of 110/112, with the STRICT SL of 104. 

For the day, intraday resistance for NIFTY comes at 5220 / 5250 / 5280 levels. At the same time, 5180 / 5150 / 5120 will act as major intraday support levels.