Monthly Archives: April 2014

#208 Nifty Update: Strong Modi Wave making it Difficult for "Bears" to stand out

Hail Modi and Hail Modi Wave on Nifty Index. In my lost post i tried to take on Bulls for some time but we couldnt stand against the strong storm from the west of Modi Wave. Me being a gujju surely want Modi to take seat at the centre but more than me it seems Nifty is wanting that result. Last time i took a closer from Daily chart and i cut my finger but this time i wont make that mistake as now i jumped to Weekly and Monthly chart directly to take a boarder view. Fundamentally, earnings have been better than expected for Non-IT stocks while IT stocks have not performed as per expectations due to stronger rupee. This is the perfect trait of a bull run start when IT and FMCG post weaker earnings compared to other sectors. Overall all the companies our performing better than last quarter. SunPharma buying stake in Ranbaxy and Lafarage and Holcim mergers were the most talked and looked last quarter. Though later deal is yet not finalised but important for India as Ambuja and ACC are part of Holcim. Many Midcap and penny stock are the best pockets to park your money currently. My picks are Leela, Sintex, and Suzlon as of now though they are high risk stock. US on other side is improving on their economy as suggested by data and stock market is at all time high. Coming back to Indian technicals, as you all can notice on the weekly chart of Nifty that index has just crossed a strong resistance line this week which was connecting the previous two highs of last year. This is the strong trait for analyst like me. On other line it is travelling between the strong steep upside channel making us bias towards Bulls. It has been taking strong support at 5 Weekly EMA.  Weekly indicators are approaching OverBought Zone but yet still havent confirmed it. Looking at monthly chart we getting a bigger picture on nifty which suggest a strong up move still from here. So now i am surely avoiding any short term trading call on index and rather go long and sit tight for a month or so. 6736 is strong support for this week and 6497 for coming weeks.

Our recommendation: We recommend to Go long and HOLD with tgts of 7200/7480 with SL of 6500 on closing weekly basis

*Note: All the words mentioned in my post are just correlated to nifty and please take position on my recommendation after through study and consulting your advisor. Trade at your risk

#207 Nifty Update: Ab ki Baar, Nifty ko Maar

Indian Cricket stadium has always been electrifying for IPL but this time whatsapp and social media are more electrifying with youth taking interest in Election starting tomorrow. All the media apps, atleast on my phone, are flooded with Ab Ki baar, Modi sarkar one liners and Funny quotes. But on markets for next few weeks it could be dangerous slides that is why ‘Ab ki Baar, Nifty Ko Maar’. We have seen none stop electrifying run from 5933 to 6776 but now its time for some profit booking. In our last post i mentioned that 6780 is strong resistance and Nifty on Thursday resisted at 6777 which was just at the stop we mentioned. What made markets weak was bank license announcement which was just out of the box what traders expected. Two Finance company IDFC and Bandhan Finance were lucky enough to get the license. Many rejected applicants were dissappointed with the decision and why not as they were more financial sound than the approved applicants. This could bring some profit booking in the Finance space which had moved in anticipation of getting banking license. On global front, US payroll is increasing at a steady pace which could lead in cutting more stimulus as market seems to have been improving. Russia may enter recession if capital outflow continues due to political tension over Crimea. Coming back to Technicals, Nifty daily charts suggest a highly overbough markets. As we all could notice on the charts above it was in upward channel which could now be breached on Monday to give us steep downfall. It has closed below 5 day moving average for the first time in recent time to show biasness towards downside. Monday opening could hour would give a clear idea. If the opening of NIfty is below 6705 on Monday and if it even trades below that level for 5 points too than downside breached is confirmed. 
Our Recommended Strategy: We recommend traders to go short on nifty CMP: 6694 with tgts of 6586/6453/6350 SL: 6810 (closing basis)
Note: all levels are of Cash Nifty and we would recommend to book 20% profit at 6586 50% at 6453, 30% at 6350 to all are traders. Please rely on our recommendation after consulting your advisor and at your risk