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Market Outlook -
April 27,
2010 |
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The much-touted supply range between the Nifty
levels of 5340 and 5360 did bring in selling
pressure that the bulls were rather unable to
overcome: the Nifty settled lower at 5322.45 at
the close. It is true that there is considerable
skepticism above 5300 and the test of the
coveted 5400 is yet to happen. However, though
it may seem that the bulls are running out of
gumption to push things up they are only down
but not out.
So long as the Nifty maintains above the major
support range for the day between 5293 and 5274,
it retains its ability to climb to higher
altitudes. The last five days though there had
been no major up-days but the Nifty steadily
moved up posting consecutive higher closing
levels. Thus, the bulls may be a bit down but
they are not out.
Again, the battle is being fought on the one
hand between 5294 and 5274 on the lower side
while 5340 and 5360 on the upper side. The clear
direction of the market is likely to be seen
once either these two ranges are decisively
taken out.
The Put-Call Ratio at 1.33 does not show any
gung-ho drive among the bulls but it is still
quite healthy. We would be concerned if it were
to fall below 1.10 and stays there. The FIIs are
still net buyers in the recent past. Only the
dark cloud covering Greece is a major problem.
It stands like an overhang on the equity markets
in the world.
The Asian markets are fairly wobbly this morning
after the Dow barely managing to close in the
green with the S&P 500 and the Nasdaq finishing
off in the red. The SGX April Nifty is at 5307
and the May Nifty trades at 5313 on heavy
volumes, as we write this Market Outlook.
Probably, a test of the support zone between
5293 and 5274 is on the cards today. However,
the bulls would lose all the initiative of the
last five sessions only when the index
decisively falls below 5249 and stays there.
On the upside, above 5360, if at the Nifty were
to move up its next significant hurdle prior to
5400 would be at 5379.
Rajat K. Bose |
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| Notes: |
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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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Rajat K Bose
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