Nifty Weekly Outlook (06th to 10th February 2012)

From 5204.70 to 5325.85, NIFTY gained almost 121.15 points and ended in Green last week on Friday (03^rd February 2012) at 5325.85 gaining almost around 2.33% as compared to the last week’s closing of 5204.70. It has been a bull run for NIFTY since last five weeks, or say last one month period from 4746.90 to 5325.85, registering an exorbitant growth of 12.20%. Many Mid Caps and Large Caps Stocks and Sectors took part in this rally, especially which were beaten down harshly. Again the markets move not only domestically, but all over the globe only on the hopes that Greece will come out with a definite Bailout Plan. On Thursday, SC came with an important decision on Telecom Companies. The Supreme Court (SC) cancelled 122 licenses issued after January 2008. TRAI will make fresh recommendations on grant of licenses. Also, all spectrum issues post Jan 2008 to be cancelled. The government will take decision on licenses 1 month post TRAI recommendation. BANKING, REALTY & INFRA, METAL & MINING, AUTO, CAPITAL GOODS, TEXTILE, SHIPPING and IT were the largest gainers during this rally. NIFTY crossed all its important resistances of 5120/5200 very swiftly. It made a high of 5334.85, whereas a low of 5076.70 for the week. Stock specific and Sector specific buying was witnessed as Results Season has arrived and also many of them witnessed Buying at bottom levels. Finally after witnessing a purely northwards movement for whole of the week, it ended at 5325.85.

Technically, NIFTY has made a Long White Candlestick Pattern, with a longer lower shadow, which shows that NIFTY recovered from week’s low level and closed near week’s high level. It has been a five week winning streak for the markets. If a look at Chart is taken, a negative crossover between 100-Days SMA (Simple Moving Average) and 40-Days EMA (Exponential Moving Average) is still intact. But last week NIFTY crossed the level of its 40-Days EMA of 5132.36 on the closing basis and is still trading below its 100-Days SMA of 5408.23, which may also act as a next strong physiological resistance level for it. An Extension Level is being drawn from the Low of 2539.45 (week ended 06^th March, 2009) to the life-time high of 6338.50 (week ended 05^th November, 2010), of which NIFTY has crossed the strong resistance level of its 38.20% Extension level of 4887.26, which it was facing for more than a month period. On the other hand, it is taking a strong support of its 50.00% Retracement level of 4438.98. NIFTY has also crossed the trendline marked from November, 2010 on closing basis, which was till now acting as a good resistance level for it. Now, this trendline marked will act as an immediate support level for NIFTY, which comes at 4980.

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 take part in this rally through bottom fishing in the beaten down sectors and stocks and also Traders are suggested to trade with the market trend in by following Strict Stop Losses.

Quarterly Results Season is on the move in all the financial markets around the globe. Some of the important results to be announced next week in different markets are being presented here. BAJAJ ELECTRIC, PRICOL, BGR ENERGY, ZYDUS WELLNESS, MUKTA ARTS, HINDUNILVR, JUBILANT, GULF OIL CORP, SPICE JET, TEXMACO, MOIL, RANE HOLDINGS, HANUNG TOYS, DHAMPUR SUGAR, MERCK, NATIONALUM, TRENT, NCC, BLISS GVS, CAREER POINT, GMR INFRA, OMAXE, HIND OIL EXPLORATION, NAVNEET, TIDE WATER OIL, UNITED BREWERIES, BAJAJ CORP, PVP VENTURES, ILandFS TRANS, TRIVENI ENGG, CADILHC, ARSS INFRA, OPTOCIRCUI, JSW ISPAT STEEL, KSOILS, ORCHIDCHEM, ESSAR SHIPPING, BRIGADE, POWERGRID, TULIP, ONGC, BHARTIARTL, TECHM, INDSFTLAB, HINDALCO, JINDALSAW, FORTIS, TATASTEEL, DISHMAN, APOLLOTYRE, HINDPETRO, AMBUJACEM, ANANTRAJ, ACC, MRF, RELCAPITAL, SRTRANSFIN, ESSAROIL, JSWSTEEL, BPCL, PANTALOONR, IDFC, UFLEX, BRITANNIA, BHARATISHIP, NEYVELILIG, SUNTV, GESHIP, BFUTILITE, DLF, TWL, BRFL and HATHWAY will be announcing their results in INDIA.

SANOFI SA, ALCATEL LUCENT SA and TOTAL SA will be coming out with its results in FRANCE. GLAXOSMITHKLINE PLC, RECKITT BENCKISER GROUP PLC, DIAGEO PLC, ROLLS-ROYCE HOLDING PLC, RIO TINTO PLC and BARCLAYS PLC will be announcing their results in U.K. KKR FINANCIAL HOLDINGS LLC, COCA-COLA CO, WALT DISNEY CO, MOODYS CORP, SPRINT NEXTEL CORP, TIME WARNER INC, VISA INC, CISCO SYSTEMS INC, PEPSICO INC and LINKEDLN CORP will be coming out with their results in U.S.

If a look at International Markets is taken, all the Markets around the Globe posted good gains and moved above their respective resistance levels, the same was imitated by the Indian Markets too. Still the deepening fear of European Debt Crisis has spread uncertainty in the markets all around the Globe.

FIIs (Foreign Institutional Investors) were the Net Buyers of Rs. 5114.32 Crore while DIIs (Domestic Institutional Investors) were the Net Sellers of Rs. 2375.96 Crore, in Cash Segment for the last week.

On the Global front, in ASIA, investors look to China for a possible easing in the country's inflation numbers. Plus, corporate earnings are expected from Japan's auto giants. In Europe, The European Central Bank is likely to keep monetary policy on hold next week, while the Bank of England may decide to expand its asset-purchase program in an effort to revive the British economy. In U.S., markets will likely focus on Cisco Systems Inc, Walt Disney & Co. and whether Greece and its banks reach a deal over restructuring debt. INDIA will be coming out with its IIP (Index of Industrial Production) Data for the month of December.

For the week, resistance for NIFTY comes at 5440 & 5550 levels. At the same time, 5140 & 5050 will act as major support levels.