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While the Dow has closed marginally higher above
the 11000-mark and the S&P 500 is at the
doorstep of the 1200-mark by closing at 1196,
the Asian markets are wobbly this morning and
they are trading down--as we write this Market
Outlook-by anywhere between 0.25% and 0.75%.
Japanese stocks have surrendered some of their
gains from the previous session and Australian
shares are down by weakness in mining stocks.
The Singapore SGX April Nifty is trading at 5327
down by 21 points at the time of writing this
newsletter; however, the fall is on low volumes.
Reviewing the last few sessions’ trading
activity what we notice is that the level of
5389 has proved to be too much of a supply
zone-this is the true supply pressure point.
While the Nifty may have moved very close
(5399.65) to the 5400-mark, it did never clear
the resistance at 5389. Thus, unless we see a
decisive breakout above that level we do not see
any major breakthrough by the bulls, at least as
of now.
However, prior to that the range between 5339
and 5349 would assume a great deal of
importance-this is the immediate supply zone if
the index were to open lower than 5335 or even
within the zone. Opening above 5350, we need to
see if it quickly slips into the supply zone
referred to here or it takes that zone as a
support and starts moving up. In that case, the
levels of 5364 and 5377 would be the two
resistance levels to contend with before the
index really takes on 5389.
On the way down, below 5320, strong support
exists first between 5310 and 5306 and then
between 5291 and 5287. Unless there is too much
selling pressure, this lower support zone
between 5291 and 5287 is unlikely to be broken.
Thus, we can characterize broadly the zone
between 5310 and 5287 as a major support cluster
in which 5306 and 5287 assume crucial importance
as individual levels in today’s trading.
We do not foresee any major weakness in the
Nifty; hence, we are not discussing sub-5287
levels here today.
Rajat K. Bose |
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All prices relate to the NSE, unless otherwise mentioned. |
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Stop-loss levels are given so that there is a level below/above, which the market will tell us that the call has gone wrong. Stop-loss is an essential risk control mechanism; it should always be there. |
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Book, at least, part profits when the prices reach their targets; if you continue to hold on to positions then use trailing stops to lock in your profits. |
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Don't chase a stock, if you are unable to buy a stock because it hits circuit levels on successive days, don't buy that. |
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The analyst and his clients may or may not have positions in the securities mentioned above. |
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Trading involves considerable risk. Trade at your own risk to the extent you are comfortable. The analyst shall not be responsible for any losses incurred for acting on these
recommendations. |
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