Yesterday,
NIFTY made a Long White Candlestick
Pattern, showing strong buying pressure in the market. The Long White
Candlestick shows that the prices advanced significantly from open to close
during the day under strong buying pressure and buyers were aggressive. NIFTY
registered an exorbitant single-day gain of 120 points, raising the most in
nearly 7-months. NIFTY had a very flat opening but with the commencement of
trading session further and further it continued gaining more and more strength
on the back support of BANKING & FINANCE, REALTY & INFRA and AUTO
Sectors. Even CEMENT Sector also gained smartly. Market was oversold, and
positive triggers since Monday have led to a lot of short-covering. Market also
rose on the impression that – “Easing inflation may lead to a rate cut. Sharp
fall in gold and oil prices, will have a positive impact on subsidy bill and
the CAD (current account deficit)”. Data released on Monday showed wholesale
price inflation slowed sharply to a 40-month low in March. This coupled with a
steep fall in gold and crude oil prices, may allow the Reserve Bank of India
(RBI) to cut the policy rate next month. Lower interest rates are likely to
boost Indian stocks. In March, core inflation, or inflation that excludes
volatile food and fuel prices, also touched a 36-month low at 3.4%, remaining
within the 4% tolerance limit of the central bank for the second month in a
row. Even market ignored all the negative Global Cues especially China reporting
that its gross domestic product for the January-through-March quarter grew
7.7% from a year earlier, less than forecasts calling for growth of 8%, while
industrial production in April slowed to 8.9%, the weakest in more than a year.
This Data of China led the markets all over the world bleeding. For the day,
NIFTY marked a low of 5555.85 just after opening, but it closed firmly at the
levels of 5688.95, much closer to the day’s high of 5699.25.
Technically, a Fibonnaci Retracement Level is being drawn
from the Low of 4770.35 (04th June, 2012) to the High marked 6111.80
by NIFTY (29th January, 2013). NIFTY made a high of 5699.25 on 16th
April, 2013 and surpassed the levels of 5599.37 (38.20% Level of Retracement).
This level was acting as a very strong resistance for NIFTY on the closing
basis, but now NIFTY has crossed it on closing basis. Now, the level of 5795 (23.60%
Level of Retracement) is the next resistance level to be tested by NIFTY. The
levels of 5441.08 (50.00% Level of Retracement) will now act as the immediate
Support Level for NIFTY. NIFTY is now trading above its 20-Days EMA
(Exponential Moving Average) and 200-Days SMA, but at the same time it is
trading below its 50-Days SMA (Simple Moving Average) on the closing basis. NIFTY
is now trading below all its Moving Averages.
As predicted earlier too, “The 20-Days EMA as well as the 200-Days SMA are acting as a good
resistance for it right now on closing basis. Unless NIFTY closes above these
levels with smart gains, even a short-term pull-back cannot be expected.” NIFTY
has crossed these two averages yesterday on closing basis and also the 20-days
EMA is on the verge of crossing the 200-Days SMA from downside, which is again
another Bullish Signal, confirmation of which is still awaited. When a Short
Term Moving Average crosses a Longer Term Moving Average from downside, it is
considered to be a Bullish Signal. Now, the level of 5800/5850 can be touched
by NIFTY if it sustains above 5650, as predicted earlier – “NIFTY is range bound currently. 5600 – 5480 is the range in which it
is trading between, a decisive move above or below this range will decide the
direction of the market.”
As,
Earnings Season has begun all over the Globe, some of the Quarterly Earnings on
which focus has to be given are:
U.S.: Bank of America Corp, Abbott Laboratories, Sandisk Corp,
American Express Co and eBay Inc.
INDIA: HCL Tech, TCS, Yes Bank, Liberty Phosphates and
Puravankara Projects.
Some of
the Economic Happenings on which a Glance is necessary are:
JAPAN: Consumer Confidence Index for the month of March, Foreign
investment in Japan Stocks, Merchandise Trade Balance Total for the month of
March, Exports and Imports for the month of March.
EUROPE: Average Earnings both excluding and including Bonus for
the month of February, Claimant Count Rate for the month of March, ILO
Unemployment Rate for the month of February, Construction Output for the month
of February (MoM) & (YoY).
INDIA: M3 Money Supply.
U.S.: EIA Crude Oil Stocks Change.
Still, for the overall market a very cautious approach of
TRADING is recommended, as INDIA is facing Political Uncertainty as well Fund
Outflow from FIIs through ETFs and even Global Economic Scenario is again
getting worsen, whether it be EUROPE or The U.S. Small and quick profits should
be booked either on Short side or on Long side. Traders are suggested to trade
cautiously by following Strict Stop Losses and Booking Fast Profits, whereas,
Investors are suggested to make good use of their money and hunt on for Jewels
which are right now trading either at their 52-week’s low level or at the life
time low levels.
What does Indicators Say?
1. RSI (14 Days & 9 Days): The values are 51.03 and 39.96, respectively. The indicator is now reverting from its oversold zone.
2. MACD (26 Days & 12 Days): Their Values are 97.82 and 93.65, respectively. The indicator is now reverting from its oversold zone.
3. +DI: 25.11, -DI: 25.62, ADX: 25.74: The Negative Directional Index as well as the Positive Directional Index are trading at almost the same level, and the Average Directional Index is above 20, indicates that the trend of the market is strengthening.
Some Trading Stats of Tuesday’s (16th April, 2013)
Trading Session:
Net Buying of Rs. 591.75 Crore in NSE, BSE and MCX-SX in Capital
Market Segment by FIIs and Net
Selling of Rs. 204.89 Crore in NSE, BSE and MCX-SX in Capital
Market Segment by DIIs was witnessed on Tuesday’s Trading Session.
NIFTY APR FUTURE ended at a Premium of 7.40
Points to the Spot NIFTY.
A view on some of the NIFTY 50 Stocks for TODAY:
ACC: Can touch the levels of 1195/1210, if crosses the level of
1175.
AMBUJACEM: Can touch the levels of 185/187, if crosses the level of 181.
AXISBANK: Can touch the levels of 1390/1400, if crosses the level of 1368.
COALINDIA: Can touch the levels of 300/303, if crosses the level of 296.
GRASIM: Can touch the levels of 2870/2890, if crosses the level of
2840.
HDFCBANK: Can touch the levels of 674/680, if crosses the level of 665.
HEROMOTOCO: Can touch the levels of 1520/1530, if crosses the level of 1490.
HINDUNILVR: Can touch the levels of 495/500, if crosses the level of 485-486.
IDFC: Can touch the levels of 158/160, if crosses the level of
155.
JINDALSTEL: Can touch the levels of 345/350, if crosses the level of 338.
TATASTEEL: Can touch the levels of 308/312, if crosses the level of 300.
For the day, intraday resistance for NIFTY (SPOT) comes at 5720 / 5745 / 5780 levels. At the same time, 5650 / 5620 / 5580 will act as major intraday support levels.
For the day, intraday resistance for NIFTY (FUTURE) comes at 5720 / 5745 / 5790 levels. At the same time, 5675 / 5640 / 5620 will act as major intraday support levels.
For the day, intraday resistance for BANK NIFTY (FUTURE) comes at 12000 / 12270 / 12320 levels. At the same time, 11700 / 11540 / 11430 will act as major intraday support levels.
Pre Market Calls:
ADANINET: Buy ONLY IF IT TRADES ABOVE 220 for the TARGETS of 225/228, with the STRICT SL of 217.50.
LICHSGFIN: Buy ONLY IF IT TRADES ABOVE 229 for the TARGETS of 235/238, with the STRICT SL of 226.50.
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