Sunday, February 5, 2012

Nifty Outlook for 06th February 2012



On Friday, NIFTY made a Small White Candlestick Pattern. NIFTY started off trade in the positive terrain, triggered by positive global cues. Asian markets were mostly higher on Friday ahead of the US jobs data which is due late evening. China is considering increasing its participation in the rescue funds aimed at resolving the European debt crisis. NIFTY was moving in a tight range post the opening bell till the last hour of trade. It was during this course that it registered the intraday low of 5255.55.  However, it pared the minor losses and continued the range-bound session for most part of the trade. Later, during the last hour of trade NIFTY picked up momentum and rose to intraday highs in green, on back of buying interest in realty stocks. It crossed the level of 5300 and marked the high of 5334.85 for the day. Shares of telecom companies got whipped after the Supreme Court cancelled 122 2G licenses that had been issued during A Raja’s tenure. REALTY & INFRA, PHARMA and FMCG Sectors were the top gainers of the day, inching NIFTY higher, while METAL Sector was the biggest loser for the day. Finally, NIFTY ended at 5325.85 for the day, registering a closing above the levels of 5300.  

Technically, a Negative Crossover between 200-Days SMA (Simple Moving Average) and 50-Days SMA is still intact. Yesterday, NIFTY crossed this level on the closing basis too. A Fibonnaci Retracement Level is being drawn from the High of 6338.50 (08th November, 2010) to the 28-Months Low marked 4531.15 by NIFTY (21st December, 2011). Now, the level of 5433.52 (31.80% Level of Retracement) is the next resistance level to be tested by NIFTY. The levels of 5220.56 (50.00% Level of Retracement) will now act as the immediate Support Level for NIFTY. NIFTY has now crossed all the resistance levels and also closed above the level of 5200. As mentioned earlier, NIFTY may witness a pause at the level of 5220 to move ahead for the levels of 5300/5440 or may also revert from this level to 5050/4950. NIFTY crossed the level of 5220 with excellent spurt and even touched the level of 5334.85. 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, GERMANY will be coming out with its Factory Orders for the month of December. Sentix Investor Confidence for the month of February will be announced by EUROPEAN MONETARY UNION. U.K. will be announcing its Halifax House Prices for the month of January.


Q3 FY12 Results Season has commenced all over the Globe. Some of the important results to be announced tomorrow in INDIA are of ADANI PORTS, ADANIPOWER, DENABANK, GSKCONS, GUJARAT INDUSTRIES, GULF OIL CORP, HINDUNILVR, INDIACEM, JUBILANT, KESORAM INDS, MERCK, MUKTA ARTS, NATIONALUM, NCC, SPICEJET and TRENT. KKR FINANCIAL HOLDINGS LLC will be coming out with its quarterly earnings U.S.

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), 50-Days SMA (Simple Moving Average) and also 200-Days SMA of 5063.20, 4874.00 and 5190.04, respectively on the closing basis. 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 73.63 and 69.50, respectively. The indicator is moving towards ovebought zone from the oversold zone. 

2. MACD (26 Days 12 Days): Their Values are 189.94 and 150.21, respectively. A short term positive crossover is indicated by both the Moving Averages.

3. +DI: 39.67, -DI: 14.85, ADX: 26.32: The Positive Directional Index has gained strength over the Negative Directional Index and the Average Directional Index is above 20, indicates that the trend of the market is strengthening. 
4. SMA (200 Days), SMA (50 Days) & EMA (20 Days)NIFTY has crossed its 20-Days EMA (Exponential Moving Average), 50-Days SMA (Simple Moving Average) and also 200-Days SMA of 4874.005063.20 and 5190.04, respectively on the closing basis.

Some Trading Stats of the Friday’s (03rd February, 2012) Trading Session:

Net Buying of Rs. 1074.21 Crore in Cash and of Rs. 192.99 Crore in F&O Segment by FIIs was witnessed on Friday’s Trading Session.

In F&O Segment Net Buying of Rs. 107.41 Crore and of Rs. 262.38 Crore was witnessed in Index Futures and Stock Futures, respectively, whereas, Net Selling of Rs. 164.04 Crore and of Rs. 12.75 Crore was witnessed in Index Options and Stock Options, respectively.  

NIFTY FEB FUTURE ended at a Premium of 19.70 Points to the Spot NIFTY.

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

SIEMENS:                    Can touch the levels of 765/770, if crosses the level of 750.

Pre Market Calls:

ABGSHIP: Buy ONLY IF IT TRADES ABOVE 428 for the TARGETS of 438/442, with the STRICT SL of 422.

WOCKPHARMA: Buy AT THE LEVELS OF 415 for the TARGETS of 425/428, with the STRICT SL of 420. 

For the day, intraday resistance for NIFTY comes at 5350 / 5380 / 5420 levels. At the same time, 5280 / 5250 / 5220 will act as major intraday support levels.

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