Nifty Outlook for 15th February 2012

Yesterday, NIFTY made a Short White Candlestick Pattern, which shows consolidation in the market. Again the formation of this candlestick may show continuation of the trend as well as reversal. NIFTY opened flat with a negative bias of almost 8-9 points and slipped to the intraday low of 5377.95, after that it traded very range bound in the range of just 20 points (5380-5400) till the announcement of Monthly Inflation Data for the month of January. The market entered green ahead of inflation data. Positive inflation data for the month of January bolstered trade as it eased to 6.5% vs 7.7%, MoM. In the last half hour trading NIFTY marked the high of 5428.05, crossing the levels of 5400. REALTY & INFRA, AUTO, BANKING & FINANCE and CAPITAL GOODS Sectors were the top Gainers of the day, pulling NIFTY higher, while PHARMA and OIL & GAS Sectors were the biggest losers for the day. Finally, NIFTY ended at 5416.05 for the day, marking a clean sweep above the levels of 5400 in last thirty minutes of trade.  

Technically, as mentioned earlier, “The 20-Days EMA is on the verge of crossing the 200-Days SMA, which will result in a Positive Moving average Crossover (The Shorter Term Moving Average crossing the Longer Term Moving Average from downside). This crossover may lead NIFTY to more heights in forthcoming trading sessions”. The 20-Days EMA has crossed the 200-Days SMA from downside, but NIFTY is facing a resistance of the level of 5400 on the closing basis. Two – three consecutive closing above the levels of 5440, may lead NIFTY to the levels of 5550/5650 too. 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 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.

On the Economic Front, CHINA will be coming out with its FDI – Foreign Direct Investment for the month of December. Q4 Gross Domestic Product will be announced in GERMANY. U.K. will be coming out with its Claimant Count Change for the month of January, ILO Unemployment Rate, Average Earnings excluding and including Bonus for the month of February and also BoE (Bank of England) will be coming out with its Quarterly Inflation Report. Q4 Gross Domestic Product and Trade Balance for the month of December will be announced by EUROPEAN MONETARY UNION. U.S. will be coming out with its Net Long-Term TIC Flows for the month of December, Capacity Utilization and Industrial Production for the month of January, NAHM Housing Market Index and NY Empire State Manufacturing Index for the month of February.

Q3 FY12 Results Season has commenced all over the Globe. Some of the important results to be announced tomorrow are of BNP PARIBAS SA and PEUGEOT SA in FRANCE. PUMA SE will be announcing its results in GERMANY. NVIDIA CORP and MARRIOTT INTERNATIONAL INC will be announcing their results in 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 5225.19, 4942.81 and 5174.17, 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 73.24 and 72.28, respectively. The indicator is moving towards ovebought zone from the oversold zone. 

2. MACD (26 Days & 12 Days): Their Values are 187.03 and 185.87, respectively. A short term positive crossover is indicated by both the Moving Averages.

3. +DI: 32.16, -DI: 9.14, ADX: 37.47: 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 5225.19, 4942.81 and 5174.17, respectively on the closing basis. 

Some Trading Stats of the Tuesday’s (14^th February, 2012) Trading Session:

Net Buying of Rs. 1030.12 Crore in Cash while Net Selling of Rs. 642.30 Crore in F&O Segment by FIIs was witnessed on Tuesday’s Trading Session.

In F&O Segment Net Selling of Rs. 353.41 Crore, of Rs. 444.89 Crore and of Rs. 34.94 Crore was witnessed in Index Options, Stock Futures and Stock Options, respectively, whereas, Net Buying of Rs. 190.93 Crore was witnessed in Index Futures.  

NIFTY FEB FUTURE ended at a Premium of 24.30 Points to the Spot NIFTY.

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

HEROMOTOCO: Can touch the levels of 2100/2110, if crosses the level of 2085.

HINDALCO:       Can touch the levels of 165/167, if crosses the level of 162.

MARUTI:           Can touch the levels of 1285/1295, if crosses the level of 1270.

RCOM:              Can touch the levels of 101.50/102, if crosses the level of 99.60.

ACC:                Can dip to the levels of 1310/1300, if breaches the level of 1335.

TATAPOWER:    Can dip to the levels of 102/101, if breaches the level of 104.

Pre Market Calls:

MCDOWELL-N: Buy ONLY IF IT TRADES ABOVE 680 for the TARGETS of 695/702, with the STRICT SL of 671.

APIL: Buy AT THE LEVELS OF 421-422 for the TARGETS of 432/438, with the STRICT SL of 415.80. 

For the day, intraday resistance for NIFTY comes at 5450 / 5480 / 5520 levels. At the same time, 5380 / 5350 / 5320 will act as major intraday support levels.