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Probably, a short term bottom has been formed on
last Friday. The way the stocks across the board
moved up from their lows barring FMCG and some
stocks from other sectors, it seemed as if the
market has regained some confidence to come back
to the buy mode. However, such buoyancy needs to
be backed by follow-on buying in subsequent
trading sessions. Thus, the market needs to be
watched that much more closely for right cues in
the next few trading sessions.
Generally, after a protracted fall like this one
where the Nifty lost 545 points from the top
5310.85 on Jan 06, 2010, we tend to see a good
rebound. In some cases, in the past they pointed
to a fresh intermediate upswing. This time the
127-point recovery that we saw during
mid-session Friday from the low of 4766 to the
day’s high 4893.70 shows an all round buying,
which clearly indicates that some positive thing
is underway. The Put-Call Ratio for Nifty has
bounced back to 1.15 and the DIIs have emerged
as big buyers even as the FIIs continued to
remain sellers in the market.
Initially, above 4930, the resistance is quite
likely to be found at 4953 – 4964 zone. Above
that strong supply is likely to come at around
5020.
The global cues as of now are mixed while Europe
closed mostly in the green, the US market
surrendered all the intraday gains though Europe
did finish with gains.
We, however, think that unless the 4766 is
broken again dips are best taken as buying
opportunities for short term.
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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