Technical Check & Outlook 27/11/09

Market View

Indian markets came under heavy selling pressure due to a sell-off seen inChina and other Asian markets and also on weak European opening. The Sensex closed at 16,854 down 344 points after making an early high of 17,202 and hit an intra-day low of 16,808. The Nifty shut at 5,005 down 102 points or 2%. Banking, metal, oil & gas and realty stocks led the broad-based selling today. The BSE Midcap Index fell 1.45% and Smallcap was down 0.98%. The breadth remained negative and the market recorded the highest ever turnover on the last day of Nov series at Rs 1,59,224 cr. The Dec Nifty future ended with 25 point discount at 4,980. For the Nov expiry the Nifty was up 5.5%.

Nifty

Yesterday’s fall was in inline with the major fall in Asian and European markets and also due to the Nov expiry unwinding. The medium term trend still remains positive unless Nifty holds 4,745 and in the short term a fall in the range of 4,905-4,820 is a buying opportunity and this kind of corrections are healthy.

Today is the start of the new Dec series and the first support is at 4,970 which is the 50-day moving average for Nifty. If this point gets broken then the current uptrend gets disturbed for a short time and nifty could test 4,920-4,830 shortly. So be cautious if nifty breaks 4,970 on the closing basis. Pharma, FMCG stocks look strong and defensive buy, banking looks weak.

Trend reversal: Below 4,920 and positive move only above 5,070.

Nifty outlook

Nifty could initial find support around 4,970 which is the 50-day moving average. If this point gets broken then the current uptrend gets disturbed for a short time and nifty could test 4,920-4,830 shortly. So be cautious if nifty breaks 4,970 on the closing basis.

Strategy & Target

Selling in Nifty could be done with target of 4970 - 4920 levels.





Stock To Watch

Dena Bank Ltd (77.80)

Strategy & Target - Dena Bank Ltd looks weak for last few of days. Stock could find next support around 75 levels. Below 75 stock could find strong support around 70 levels. Selling in Dena Bank Ltd could be done with inital target of 75.



Relaince Infrastructure Ltd (1033)

Strategy & Target - Relaince Infrastructure Ltd is in down trend and if market sees some profit booking stock could see some more selling pressure. Target 1005



Tata Steel Ltd (543)

Strategy & Target - Tata Steel Ltd after yesterday's poor result could see some more selling pressure. Target 535. If stock closes below 535 then 526 could be next level to watch out.



Positional Ideas

EIH Ltd & EIH Associate Hotel Ltd could see action in days to come as there could be some action expected from Max India and ITC Ltd.

Target

EIH Ltd - 148

EIH Associate Hotel Ltd - 146