Mid Caps Join The Party

Market encountered some profit taking at higher levels as Nifty saw intraday dip to around 5850. But, strong momentum helped indices to recover all its intraday losses as Nifty bounced back to close above 5900. The mid caps and small caps extended their rally by one more session. Banking heavyweights led the dip earlier in the day as stocks like HDFC Bank, Axis Bank and ICICI witnessed some selling pressure at higher levels. But, the mid cap banking names attracted strong trading interest as stocks like Vijaya bank, Andhra bank, Uco Bank, Dena Bank, Syndicate Bank, IOB an Indian Bank moved up sharply on good volumes. In fact, the list of gainers was made up of mainly the mid cap counters. Onmobile extended its gains further as it surged almost 11%. Some other top gainers were Alok Ind, Patel Engg, Sesa Goa, Bajaj Hind, Moser Baer, Jindal SW Holding, Mundra Port and Tulip. HUL, M&M, DLF and Havells were amongst day’s top losers. Overall, the undercurrent was positive despite slight negative undertone in Nifty. Even Nifty did well to claw its way back above 5900.

There was some intraday hiccup in the ongoing up move as Nifty lost almost 50 points mid session. But strong buying in stocks like TCS, Tata Motors and metal heavyweights helped indices to erase all losses towards the close. Mid caps are beginning to join the party as traders get more confident about the upmove. Mid cap banks that look good for decent upside are Syndicate Bank, Indian Bank, Dena Bank, IOB and Allahabad Bank. JSW Steel has given a breakout on daily charts and is likely to target Rs 1040-1050. Others that have positive patterns are IVRCL Infra, PFC( above 254), L&T, Tata Motors and REC( above 261).

Nifty has support around 5830-40 and then around 5770 while some resistance is around 5950-65.

Realty And Banking Lead The Way At the Markets

It was a steady day at the bourses as Nifty traded above 5500 for majority of the session. Decent showing was seen in almost all sectors with Realty and banking leading the way. Unitech was up almost 10% on very good volumes. Many mid caps again hogged the limelight. There was strong buying in stocks like Videocon, Orbit, IBReal, Sobha and Dish TV. Auto and metals also witnessed value buying at lower levels. Ashok Leyland, Hindalco, Welcorp and TVS Motors were the major gainers from these two sectors. Some other prominent gainers were Aban, Karnataka Bank, Pantaloon, IDFC, ABB, Tech mahindra, REC, GVK, Kotak and Yes bank. Some of the yesterday’s gainers met with profit taking and shed some weight. The list includes Tata Com, Lupin, Havells, GAIL and Renuka sugars.

Nifty gained for the third consecutive day which is a rare occurrence in the present volatile scenario. But, that also means that Nifty is now staring at strong resistance zone of around 5540-50. Nifty has not managed a close above 5540 in current month despite few attempts. Nifty has seen base building over last two months and as we did mentioned earlier also, close above 5540 and then a decent follow up could open up 150-200 points upside. Again, banks are the key and Bank Nifty is on the verge of a sharp and strong breakout above 11200. Realty counters are showing interesting patterns and stocks like Sobha, HDIL, Orbit, IB Real and Unitech could see substantial upside once they manage to sustain current levels. Dish TV closed above Rs 64 and could target Rs 71-72 over next few sessions. Ambuja Cement managed to close above 133-135 resistance zone after a gap of about 10 weeks and likely to target 146-149. Banks that have bullish patterns are Kotak, Indusind and Yes Bank.

Nifty now has support around 5460-70 and then around 5420 while strong momentum is likely once Nifty sustains above 5550-65.

Another Listless Day In The Markets

Markets were in a slightly positive mode as Nifty managed to trade above 5400 for most part of the day. Indices were largely helped by heavyweights like Bharti, SBI, HDFC, JP Associates and DLF. Maruti witnessed some value buying at lower levels and was amongst the day’s top gainers. Some banking and infra stocks too were on the value buying list. Some of the prominent gainers were LITL, Tata Comm, Neyvelli, Apollo Tyres, Havells, Maruti, Opto Circuits, Pantaloon, Renuka , LIC Hsg and Bata India. But, despite the positive bias throughout the session market lacked any momentum and traders’ activity was also on the lower side.

Nothing much changed technically as Nifty failed to build any positive momentum. The 5420-25 zone provided intraday resistance and despite trading around that level Nifty failed to make any substantial headway. Nothing much is happening at the bourses and there are not much trading opportunities even for the short term. Lack of momentum is visible on both sides, Buy as well as side and it seems waiting for even reasonably probable trading opportunities is the only option as of now. For Nifty, support is seen around 5330-35 and sustained trades above 5430 could open a 50-60 points opportunity on the upside.

Auto, Banking Sectors Lead Rally In Budget Week

The Budget week lived upto its reputation of being a volatile one. Volatility began on the Budget day itself as Nifty rallied initially, only to give up most of its gains. But, the day after saw a one sided up move of around 200 points as Nifty moved past 5500. Overall, it was a good week for bulls as indices rallied over 4%. This came against the backdrop of higher Crude prices and a lukewarm Budget. But, the fact that there were no expectations whatsoever from the Budget and there were short positions going into the Budget helped the markets. Auto, FMCG and Banking indices were the top three gainers for various reasons associated to Budget. There were no sectoral losers but the least gains were seen in IT and Oil and Gas. Nifty crossed 5600 briefly on Friday before selling set in at higher levels. Markets have seen a decent rally post Budget but now we are placed just around the strong resistance zone of 5550 to 5600. As mentioned earlier, it may not be easier to take out this resistance in one go. But, we do believe that market has made a sustainable bottom around 5230 and for the first time since November 2010, we have a higher bottom and now higher top( 5608 on Friday). The resistance at 5600 is likely to be taken out eventually maybe over next 5-7 trading sessions. Any correction should find initial support around 5440-60 and then a strong one around 5350-5375. The second level is unlikely to be breached and positional traders could take long positions on declines in Nifty as well as bullish counters with positional stop loss below 5340. Clear breakout is seen above 5625 with potential targets of 5770 and around 5900. Banks and Autos have been the leaders in the current rally. One needs to be selective in Autos and we see positive bias in Bajaj Auto and Hero Honda (above 1560). Banking is looking to be in a better shape and one can use dips to accumulate stocks like HDFC Bank, SBI, Yes Bank, Indusind Bank, Allahabad bank, OBC, Canara Bank and BOI. Another important thing to note is that once Nifty stabilizes above 5625 short covering could lift the weaker sectors like Infra and Realty too. Certain other counters that are looking positive and are Buy on dips candidates are L&T, IDFC, Havells, Cairns and Sterlite.

Nifty has immediate support around 5445-60 and then around 5375-5400 while resistance should be seen between 5570-5610.

Budget Fails To Impact Markets

Union Budget was presented in the Parliament and the markets witnessed a see-saw movement post Budget. It rallied sharply immediately after the Budget speech and Nifty was up more than 3% at one point of time. As the current Budget was low on expectations it seemed more like a relief rally. But, as the Budget lacked any big bang announcements, the higher levels once again attracted selling and Nifty lost almost all its post speech gains in the last 60 minutes to close with a marginal gain of only 30 points. The stocks or sectors that gained post Budget were the ones that were expecting some negative announcements and the absence of such negative measures provided a leg up to these sectors. Cases in point are Auto stocks and tobacco stocks. The banking or financial stocks were also amongst the gainers as FM pegged the fiscal deficit at just around 4.6%. So, the prominent gainers were ITC, IDFC, TVS Motors, IOB, Central Bank, Reliance Cap, Canara Bank, Federal Bank, M&M and Maruti.Coal India was nother nig stock to gain sharply as the Coal prices were increased 30%. But this measure had a negative fallout on the user sectors and power and cement stocks reacted negatively. There were some measures to boost infra spending but nothing much to enthuse the markets. Sesa Goa was impacted negatively as 20% duty was imposed on iron ore exports. So, the list of losers had stocks like BGR Energy, Patel Engg., Sesa Goa, Jain Irrigation, Mundra Ports, Pantaloon, Educomp, Reliance Infra, Ambuja Cement, TV18, Ranbaxy and JP Industries.

So, the Budget has come and gone and has largely failed to have much of impacts on markets. We are back to looking at Global cues and Crude oil movement. But, since there were no or muted expectations market is unlikely to react much on the lower side. We could see a drop in volatility and perhaps a sideways movement between 5200 and 5600 for the short term. Some base building is likely in certain banking/financial stocks. The Auto counters too could consolidate around current levels before moving higher. But, broadly nothing much seems to have changed technically for the overall markets and the bigger sectors. Nifty must trade above 5375-85 consistently to be in the neutral territory, atleast. 5250-60 is likely to provide support in the near term.

Markets Brace For More Surprises

The ongoing 5 day rally was cut short abruptly and violently on Friday as Nifty slipped more than 150 points from its intraday peak of 5600. Nifty had rallied another 50 points in the morning session before selling in most heavyweights pushed the indices lower. Selling was seen across the board as bears pounced upon the opportunity. The infra and realty were the first to lose ground but even the banking counters encountered a drubbing. Still, Nifty ended the week with a gain of around 2.8%. Banking index emerged as the biggest gainer with Capital gains and metals index following closely. All sectors finished the week in green. But, as we enter the expiry week for the Feb series the momentum may have shifted towards the bearish scenario as the volumes on Friday were huge.  5350-70 would be the first significant support zone on the downside and while it was broken without much sweat, it is expected to provide some strong support this time around. But more than the technicals, it’s the other happenings that could impact the markets. Monday happens to be the beginning of Budget session and traders and investors would be watching it with anxiety and nervousness. If the parliament is not allowed to function properly then it would provide more fodder to the confident bears and would be a big negative. Then, the CBI enquiries into 2G scam is another event that’s causing much nervousness and there’s always a question hanging in air, ‘who’s next’.  Even Friday’s session was hot on various rumors and that may have added to the unwinding/short selling. And then, we have not even touched upon the various international events, be it Middle-east crisis or tightening by China. So, overall next week is expected to be extremely volatile and it would be foolhardy to anticipate anything.  As for technical levels, as mentioned earlier 5350-5370 should be the first hurdle for bears while more support is seen around 5280-5300. Drop to the second support could be utilized for some bargain buying in banking and Capital Goods/infra counters. On the way up, 5510-25 would be the initial hurdle while strong resistance is likely around 5575-5610.

Negative Sentiments Continue in Markets

Markets opened on a negative note and traded in the negative territory for the better part of the session. Nifty slipped to as low as 5416 in the early trades as the sentiments turned hugely negative. Some value buying in some heavyweights coupled with some short covering helped indices to rebound in the later half. Nifty retraced almost all its losses and managed to close above 5500. The index was largely helped by the likes of ONGC, L&T, Bhel, SBI and Maruti. Banking stocks also saw value buying at lower levels and good numbers by Canara Bank and Andhra bank also helped in boosting the sentiments a bit. Siemens was the biggest gainer for the day as its German parent announced a open offer at Rs930 per share. The sentiment rubbed off on other such companies like ABB also. Prominent gainers of the session were Can bank, LITL, Crompton Greaves, Ashok Leyland, Federal bank, BOB, ONGC, DRReddy, Indusind, Titan, Gail, UBI and Bhel. The infra and Realty counters continued to slip and were amongst the top losers. Jain Irrigation lost almost 11% on long unwinding. Losers’ include HDIL, Unitech, JP Associates, Jet, Bata, HCC, KFA, BGR Energy, Bajaj Hind, IVRCL Infra, Escorts, REC, PFC and Voltas. 

Nifty recovered from the day’s lows and closed above 5500. Banking and metal stocks witnessed some buying at lower levels. Even Auto counters saw some buying ahead of monthly sales figures. Broadly, we believe that while Autos might see some rebound, the overall technical picture is not looking pretty for most Auto stocks. Rebound should be utilized to lighten long positions. Banks, however are looking much better technically and could be accumulated in smaller lots. However, It is unreasonable to expect a painless rise in any stock considering the kind of down momentum we have been witnessing. Stocks as well as indices are likely to see selling pressure at every rise and that might make any climb upwards difficult and slippery.

Nifty has immediate support around 5430-50 while resistance is likely around 5560 and then around 5630.

Nifty Continues Downward Trend In January

January has a reputation of being a bear-friendly month and Jan of 2011 has only enhanced this reputation as we are down almost 10%, with still a day to go. Well, this thumb rule has surely worked for our markets. Nifty continued its southward journey as it lost over 3% during the expiry week and the carnage spilled over to the first day of new series. All sectoral indices were in red with Realty, Health Care and Auto being the worst impacted. Least impacted on relative basis only were IT and Banking index, both managing to lose less than the Sensex and Nifty. This continued downward spiral has brought as back to around 5500 for Nifty and around 18000 for Sensex. Negative markets have had a negative impact on sentiments and suddenly it seems that nothing could go right for India. This is in stark contrast to late October- early November when it looked as if nothing could go wrong for India. Market is down almost 14% from its recent peak at around 6350. What next? Technically, we are in oversold territory for mainline indices as well as for several heavyweights. Nifty has multiple supports between 5400 and 5550. This whole range of 5400 to 5550 provided stiff challenge for almost 11 months earlier when Nifty was trying to move higher. We believe that now this range should provide atleast a temporary respite for the markets and while it’s almost impossible to pinpoint the levels of support it does look unlikely that we would trade below 5475-5500 for a sustained period. Whether this could prove to be temporary respite or a sustainable support could only be ascertained only later. Banking stocks have seen some consolidation over last two weeks and would be amongst the first ones to see a sustainable rebound. RIL did not find any support around 950 as was our expectation and has seen huge buildup in short positions. It would be prudent to wait for it to stabilize above 950 before taking any fresh long positions. Sesa Goa is showing strength and could be bought on declines. 

Nifty is likely to find support around 5450-5480 while immediate resistance is at around 5620 and then around 5700.

Nifty Continues The Losing Streak

Last day of January series proved to be yet another bad one for bulls as Nifty lost over 80 points. January series saw Nifty lose around 500 points as the sentiments turned extremely negative in the short term. This has come in a global back drop that remains neutral to bullish. In fact, Dow made almost 30 months high yesterday as it crossed 12000. Even today most of the global markets were trading higher but local markets had no such luck as despite a positive start, Nifty continued to lose ground on long unwinding. Most heavyweights witnessed selling on almost across the board weakness. DLF, JSW Steel, Sterlite, M&M, Ranbaxy, HUL, Bharti, Bhel and ICICI bank were some of the heavyweights that contributed to the falling indices. Some of the other prominent losers were Srei Infra, LITL, Core, Jindal Holding, Indian Info, IDBI, IVRCL, Tata Chem, Lupin, HCC, Century textiles, Bajaj Hind, Pantaloon, Yes Bank and Unitech. Cement heavyweights ACC and Ambuja as well as Tata Motors were some of the heavyweights that bucked the overall trend and finished with decent gains. Few others to post gains were TV18, BRFL, Nalco, Alok, Areva, Sesa Goa and TCS. 

Nifty made a new swing low at 5595 and has maintained the trend of lower lows and lower highs. The momentum remains with the bears as even on the last day of January series market could not attempt even a small technical rebound. More downside is seen in coming days and Nifty might find it difficult to scale 5750-60. Support is seen around 5520-5540 on weekly charts and some technical rebound could materialize from around these levels. Sector- wise it is difficult to point out the stronger ones but it looks probable that banking sector could see buying at lower levels. Some stocks that still qualify as buy on dips are Sesa Goa, SBI, Sterlite, ICICI bank, Alok, Axis, HDFC bank, RIL, Bharti, Cipla, Praj and Petronet LNG. BUY on Dips or on bad days is the key here as it would be imprudent to play trade momentum on the buy side as the momentum remains with the sellers.

Nifty now has immediate support around 5570 and then around 5520-35 while resistance is at 5680 and then 5740-50.

Nifty Looking For Support !

Nifty moved up sharply in the latter part of the session to close above 5700. For greater part of the session market traded in the red as yet again a few heavyweights like RIL put pressure on indices. Nifty slipped below 5650 mid session before short covering coupled with some value buying in banking counters improved the sentiments. Banking heavyweights like ICICI bank and HDFC bank were amongst the prominent gainers and that boosted the sagging indices. Even SBI that made a new recent low at 2463 recovered sharply to claw its way back above 2500. Other mid cap banking counters too continued to move up. Some of the prominent gainers for the day were Orchid, Indian Bank, Dena Bank, IDBI, Syndicate bank, IFCI, IOB, Al Bank, Can bank and Central Bank. RIL was bogged down yet again by various rumors as it slipped to around Rs 950. It recovered a great part of its intraday loss towards the close but still ended the day in red. Some other losers were Crompton, United Spirits, Gail, PTC, Jain irrigation, Petronet, ITC and ONGC.

Nifty bounced back from just around the previous recent low at 5628 and recovered smartly to close above 5700. It seems that market is finding support around 5630-5650 and could again try to move past 5740-50. Banks are finding some buying around current levels as most of the banking results have been good so far. That is perhaps leading to some kind of short covering ahead of credit policy on 25^th Jan. Even a reasonable technical rebound in banking counters could support indices. Allahabad Bank, Indusind Bank, Central bank (above 174), IOB, Syndicate Bank, Can Bank ( 602) and Yes Bank( above 278) could see reasonable upside from current levels.

Nifty has immediate support around 5650 and then around 5610 while resistance is at 5740-50.

Infosys Leads As Nifty Plunges

Infosys numbers came as a disappointment and the technical rebound that showed some promise yesterday just fizzled out. Nifty opened in red and turned deeper into red as the day progressed. The inflation figures did not look good and the banking stocks that were also beginning to look good for at least some technical rebound met with heavy selling pressure. In fact Bank Nifty was down more than 3.5% as stocks like ICICI, SBI and HDFC bank moved lower. Infosys lost more than 5% and hurt the sentiments towards the whole IT sector. Some of the biggest losers for the day were Infosys, Praj, HPCL, OBC, PNB, Pantaloon, IOB, Titan and LIC hsg. Realty stocks surprisingly did well as most of them closed in the green. Some others that bucked the trend were Adani, Ambuja, Ultratech, GE Shipping, Havells, Grasim and Exide. On the whole it was a disappointing day as Nifty had yet another triple digit fall.

All the hopes for a tradable rebound were dashed early in the session as Infosys disappointed. More disappointing was the fact that banking heavyweights just failed to develop any followup momentum and on the contrary were amongst the top losing counters. Bank Nifty is back to its recent lows giving up all its gains of past two sessions in a single day. Market continues to witness volatile sessions and is basically trading violently between 5700 and 5850. Stocks are having alternative bouts of buying and selling and it is increasingly becoming difficult to find even marginally high probability trades. Break below 5700 could trigger fresh selling and might take Nifty lower to around 5575-5600. Considering the choppiness and volatility it would be better to wait for somewhat clear signals before taking any fresh trades.

Nifty finds immediate and crucial support around 5690-5710 while resistance is likely around 5835-5850.

Selling Dominates the Market

It was a terrible open to the new week as Nifty tumbled more than 150 points. There was no let up in selling momentum and there was all round selling pressure. Breadth was extremely poor as selling spread across almost every sector. Worst hit were the usual ones like Realty, banking and Autos while Capital Goods heavyweights too suffered sharp sell offs. Both L&T and Bhel were worst impacted as both saw huge institutional selling. FIIs have turned heavy sellers and despite some support from DIIs stocks continue to tumble. Banking heavyweights that looked like finding some support on Friday as well as during the morning sessions, lost ground as the day progressed and Bankex lost over 3%. Some of the worst performers were Praj, HDIL, Sintex, United Spirits, Renuka, Bajaj Hind, Syndicate bank, Rolta, Adani Ent., Alok, LIC Hsg, Aban, Havells, B.Chini, Apollo Tyres and Onmobile,all losing over 5% each. Gainers were difficult to spot and only a few like ACC, Infosys and Dabur managed to stay in the green.

Nifty has lost over 300 points in two trading sessions and 5700-5720 is being put to test again. It had held twice in past two months but the severity and the momentum of the fall suggests that we may not be third time lucky. There could be some technical rebound from around 5700 but overall pattern doesn’t inspire much confidence. There is usually a one-sided move when FIIs turn heavy sellers and the rebounds are usually short lived. Same pattern could be unfolding right now as despite heavily oversold indicators Nifty and heavyweight stocks have not managed any tradable rebound. These oversold indicators could help market to see some relief rally soon. We believe that a rebound is likely from around 5675-5700 levels. But these rebounds would be difficult to trade as the overall direction remains down. It would still be prudent to stay out and let the market stabilize, whenever that happens.

Nifty finds immediate support around 5675-5690 and resistance is likely around 5840 and then around 5885-5910.

Bouyant Nifty Crosses 6000

Nifty opened on a positive note and remained positive throughout the day. Short covering in banking heavyweights and some auto stocks helped Nifty to push for higher levels. HDFC, HDFC bank, ICICI and SBI moved higher and then there was some buying in FMCG heavyweights like HUL and ITC that further provided strength to Nifty. Metal and Bharti too helped with decent gains. Some of the prominent gainers were Ruchi Soya, Hind Zinc, HCC, MLL, Indian Info, Aban, REC, HUL, Bharti, Sterlite, Srei Infra, HDFC, HDFC Bank, Allahabad Bank and Opto circuits. PFC was the biggest loser while some other losers were Moser Baer, HDIL, Havells, Cipla, Sobha and Welcorp. Nifty finally settled at the highest point of the day at 6060.

Yesterday only we spoke about a breakout/breakdown and we were obliged by the markets instantly. Nifty kept on pushing for higher levels throughout the day as it broke past 6030. Short covering helped the momentum and it seems we have a decent breakout above 6030. Nifty may continue to move up sluggishly as there would still be various resistances ahead.  We have a target of around 6180-6220 for this breakout that might take about 7-10 sessions. Support moves to around 5980 now. REC seems to have bottomed out though it might consolidate between 280 and 300. One can keep a stop below Rs270. Bharti could move to around Rs 370-375. HDFC, Bhushan, Union Bank and Hindalco are also looking positive.

Nifty has support around 6015-20 and then around 5970-80 while resistance is likely around 6120 and then 6170-80.

NIFTY - Banking Holds The Key

It was an extremely dull and boring trading session as Nifty traded in a very narrow range. In fact, the intra day range for Nifty was only 40 points, narrowest over last 5-6 weeks. Needless to say most of the heavyweights were range bound. Steel stocks were under profit taking pressure with JSW steel losing the most. Tata Steel too lost some ground as did Sail. Infosys held the index as it made a new high. Sugar stocks staged a late rally and were amongst the top gainers for the day. Some of the prominent gainers were Sintex, Sun Pharma, FSL, ABB, Polaris, Divis Lab, OBC and Triveni. Some of the losers were Mundraport, Ashok Ley, IRB, REC, APIL, IBReal, Escorts, HPCL and Andhra bank. Nifty finally closed almost around the
previous close.

Nothing significant happened to materially change the technical picture. Still, we have levels of 5940-50 on the downside and 6020-30 on the upside. Banking remains a joker in the pack and can tilt the balance conclusively either way. Metals and IT remain the sectors with upside momentum while Realty is clearly showing downside momentum. Autos are also not showing any strength and only Tata Motors retains the positive bias. Sugar stocks are showing positive bias and an upside till 88-89 is seen in balrampur Chini. Mid cap IT is also looking good. Hexaware may see upside till 114-116 while Polaris could move to around Rs 188-190.

Nifty has now immediate support around 5935-45 and then around 5880 while resistance is likely at 6030 and then around 6070-80.

NIFTY at 6000

Nifty opened and traded above 6000 during the early part of session. But again higher levels attracted profit taking as Nifty failed to make any significant progress beyond 6020. Profit taking gained momentum towards the later half as stocks like RIL, Tata Steel and some banking heavyweights pushed Nifty towards 5950. Some metal and auto stocks recovered towards end to pare Nifty losses to only about 16 points. Banking stocks failed to build on yesterday’s momentum as HDFC Bank, SBI and other banks attracted selling at higher levels. Some of the prominent losers for the day were Sintex, Hexaware, Onmobile, Auro Pharma, Bajaj Hind, Patni, EKC, Maruti, Reliance Infra, Bharat Forge and Wipro. Ispat however attracted buying and emerged as the biggest gainer amongst the F&O counters. Bhart was significant index gainer. Some other gainers were Syndicate Bank, Patel Engg, LIC Hsg, Yes Bank, Vijaya Bank, Core Projects, IFCI and Ranbaxy.

Nifty is at crucial levels as it trades around 6000. Despite today’s hiccup Nifty remains in an uptrend and we believe that it is likely to move higher after a brief consolidation. The immediate support is around 5930-40 while stronger and significant support levels are 5870- 80. Banks could play a significant role in deciding how far Nifty moves as short covering in banking heavyweights might create strong momentum for Nifty. On the other hand, if the short covering fails to materialize in next couple of sessions, it might force longs liquidation and that could put pressure on indices. Clear uptrend is still seen in some Auto counters, metals and  IT heavyweights. As mentioned yesterday clear breakout above 11700 in bank nifty would be critical for Nifty’s momentum. Bharti, Yes bank, Indusind Bank, Hindalco, Cipla and JSPL are looking positive.

Nifty has now immediate support around 5935-45 and then around 5880 while resistance is likely at 6030 and then around 6070-80.

Banking Stocks Hold Nifty Down

The 3 day rally was interrupted as Nifty failed to move past 5950. The global cues were also not helpful as most of the Asian as well as European markets were flat or negative. Banking led the decline as after a weak-ish rebound of past 3 days almost all banking stocks resumed their southward journey. SBI slipped below 2700 while other major banking losers were Uco Bank, Dena Bank, Indusind Bank, Can bank, Allahabad Bank and Indian bank. Heavyweights like RIL, Bharti, Tata Steel and IT majors did try to positively influence the indices but failed to provide enough momentum. OMCs also bounced back but were unable to hold on to all intraday gains. Some of the prominent gainers were KS Oils, Patni, IGL, HPCL, BPCL, PTC, Ispat, TCS, Dabur and Apollo tyres. Losers included KFA, Hero Honda, DLF, IB Real, SCI, IFCI, Jet, Titan, Escorts, HDIL, SKumars and Punj Lloyd. The new listing MOIL opened on a strong note but found sustained selling pressure throughout the session and gave up more than Rs100 from its intraday peak. Overall breadth was negative.

Nifty failed to move past 5940-50 and slipped below 5900. It was a typical 3 day rebound formation followed by continuation of downtrend again. This pattern was more prominent in almost all banking counters that continue to show momentum on the downside. 5945-5960 now becomes an important resistance to tackle and a sustained move past this zone would be needed to create some upside momentum. Nifty found support just around 5870 but might slip to around 5820-30. IT heavyweights have emerged as the safe bets in current controversial scenario and are providing some support to the indices. Both TCS and Infosys have bullish patterns and could see more upside in coming sessions though it may not be a one-sided kind of move. IT heavyweights alongwith Tata Steel, RIL, Bhel, L&T and Bharti remain buy on dips candidates while banks and financials alongwith Realty counters should be avoided as of now for buying purposes.

Nifty has support around 5865-70 and then around 5825-35 while fresh move is likely above 5950.

European Markets Help Nifty Cross 5900

It was a volatile opening to the week as Nifty fluctuated in and out of positive territory. After a positive open to the trade Nifty suddenly lost significant ground as Nifty slipped below 5800. Positive open at European markets not only help recover ground but also to move up sharply in the positive zone. Finally, Nifty closed above 5900 up almost 50 points. Recovery was led by RIL as stock moved to around 3 weeks high at 1046. Banking looked weak for most part of the session but recovered significant ground towards last one hour. Capital goods were also in demand as stocks like Bhel, Siemens and later L&T found buying at lower levels. Some of the prominent gainers were SKumars, KS Oil, Hexaware, JSW Steel, Pantaloon, IRB, Ruchi Soya, IBReal, Jindal Holding, Petronet, APIL and Welcorp. Cement turned a bit weak after sharp Friday surge while some other stocks to lose ground were Uniphos, ALL, ITC, Rolta, M&M and HPCL.  

Nifty sustained above 5800 and later found enough muscle to move past 5900. Last week Nifty made a panic low at 5720 that was higher then the previous panic low of 5690. The late surge took Nifty past 5880-90 that was looking like a significant resistance. Broadly, sustained trades above 5930-40 would suggest that we have formed a decent bottom at around 5700. Nifty is likely to challenge the recent swing high of around 6070 if the resistance at 5930-40 is successfully negotiated. RIL seems to be taking the lead while the leaders of the previous rally banking and Autos are either correcting or consolidating. Bhel, APIL, Siemens and L&T are also showing positive bias and it suggests that Capital Goods could also take the lead whenever the next upmove begins. Tata Steel and Bharti are the other two heavyweights that are likely to lend support to any upmove. The above mentioned names are the ones that could be accumulated on bad days for decent returns over next 4-6 weeks. The battered mid caps are also showing early signs of recovery but short term trades should be avoided in mid caps and only good quality mid caps be accumulated with 3-6 months investment horizon in mind. 

Nifty has support around 5825-35 and significant one around 5740-50 while fresh momentum is likely above 5940.

Nifty Succumbs To Nervous Sentiments

Markets succumbed to the nervous sentiments as Nifty slipped below 5900 during the session. Nervousness was aided by the reports that IB has submitted reports of price rigging in few companies. So, there was sharp sell-off seen in some of these scrips like KS Oils, IRB Infra and Ruchi Soya. Mid and small caps were hurt the most as stocks plummeted due to lack of buying rather than any other particular reason. Amongst the large caps, banking remained under pressure and list of prominent losers was crowded with many banking names. Bank Nifty shed another 2% as it closed almost on a 3 months low. OMCs were up on reports that petrol prices might be raised as Crude moved above $90. There were some other gainers like Hexaware, Ranbaxy and ACC but overall the sentiments were extremely negative and there were much more losers than gainers. Some of the major losers were Ruchi Soya, KS Oils, Renuka, IRB, KFA, ABG Ship, Al bank, Union bank, Jain Irrigations, Orchid, Axis, Bajaj Hind and BGR Energy.

Nifty failed to sustain above 5940 but found some intraday support around 5880. But, the short term trend again has shifted into negative and would remain so as long as we trade below 5950. On the downside, levels of 5835-45 and then 5770 are possible. Banks are not showing any signs yet of bottoming out and could continue to bother indices in coming days. IT and metals to lesser extent are showing some signs of stability. Short term sentiments are being affected by all kind probes be it market related (Mkt operators, price rigging) or Government agencies related (2G Scam etc). It would be advisable to stay away till some sanity and stability returns. Few stocks that have been hammered because of short term events but hold investment values could be bought in small quantities with medium to long term investment horizon. (9-12 months). Some names that could be considered are IRB Infra, Welspun Guj and HCC.

Nifty has support around 5835-40 and then around 5770 while resistance is likely around 5960-70.

Banking Stocks Witness Strong Selling

Nifty opened on a buoyant note and traded above 6050 for considerable period. Metals and IT were largely responsible for this buoyancy. But, the leader thus far, banking saw significant amount of selling throughout the session and was largely responsible for markets shaving off all its gains. In fact Nifty closed marginally in the red at 5992. Most of the PSU banks witnessed strong selling as investors were spooked by RBI Governor’s advice to the banks on reducing lending rates and increasing deposit rates. This advice, if followed could mean reduction in NIMs of most banks. SBI lost around 4% while Can bank, BOI, Indian Bank, OBC, PNB, BOB and Allahabad Bank were other major losers. Bank Nifty was down around 2.5%. Metals were significant gainers as Tata Steel led the sector with an intraday gain of over 3%. JSW Steel, Ispat, Bhushan, JSPL and Sterlite were other prominent gainers. Tata Motors continued to accelerate as it hit a new all time high. Some other notable gainers were Welcorp, Ruchi Soya, Havells, CESC, IGL, Srei Infra, Sun Pharma, Siemens and United Spirits.

Nifty failed to encounter stiff resistance around 6050 and lost significant ground in the later half to slip below 6000. Twice now, market has failed to close above psychological levels of 20k and 6K despite spending significant intraday period above these levels. 6040-6070 remains a stiff resistance and it seems that we could see a swing to lower side and possibly a test of support at 5920-30 or even 5870-80. Banking that had taken the market higher has reversed its direction and could under perform in coming weeks. It would be prudent to avoid bargain hunting in banking stocks, particularly the PSU ones till the time the profit taking/selling subsides. Metals are showing some resilience as are some Capital Goods counters. Down days could be utilized to take long positions in leaders from these two sectors. IGL has given a daily breakout by closing above Rs340. Sustained trades above Rs 340 could take the stock higher to around Rs 365-370. Havells could target Rs 418-425 above Rs 404.

Nifty has support around 5925-40 and then around 5865-80 while resistance is likely around 6030-6040.

Bulls Have A Good Day At The Markets

Bulls had a great outing after what seems like a long time as Nifty leapfrogged by more than 100 points. After a steady opening markets gathered momentum as the day progressed. Banking stocks were in fine fettle and the sector was led by SBI as the stock moved up smartly. Bank Nifty gained almost 3%. Major banking gainers were Dena Bank, Vijaya Bank, OBC, Yes Bank, Central Bank, Union Bank and DCB. Cipla was one of the biggest gainer as it made a fresh new high. Tata Motors led the rally in auto stocks as it rallied strongly to around Rs 1300. Metals made a strong comeback on positive data from China. JSW Steel gained 7% and others like Tata Steel and Hindalco were also significant gainers. Some of the other prominent gainers were IOC, IVRCL, Punj Lloyd, Orbit, Bhushan Steel, Suzlon, Dish TV, MLL, GMR Infra, Aban, Bharat Forge and NCC. Hero Honda was the biggest loser as it dropped almost Rs100 from its intra day peak. Other losers were Mphasis, Bharti and Sesa Goa. 

Nifty consolidated around 5920-25 in the early trades and then moved up gradually to around 5970. The resistance at 5920-30 was taken out without much effort as global sentiments also helped. We are staring at 6000 again and it’s likely that Nifty could rally to around 6030-40 soon. Banking has again taken the lead and the rally in banks could continue. Dish TV moved to fresh 52-week high and is looking good for more. Stock could target Rs 80-82 within this move. Petronet LNG is likely to target Rs 130 while more upside is also seen in ABB, Central bank, ABG Ship( above 425), IFCI( above 65), Indusind Bank, Videocon( above 232), Divis, Aurobindo and Bata.

Nifty has support around 5910-20 and then around 5865-80 while resistance is likely around 6030-6040.