Archives : BULLS TAKE CHARGE - 19/12/2008.

BULLS TAKE CHARGE – 19/12/2008.

Why the Market will Move higher?

The market behaved in exactly the same manner as what we had predicted last time. The Sensex and Nifty both have closed above the very important short term indicator i.e. the 50dma after a very long period. Also the TRIX indicator is showing signs of Bullishness and has given a Buy signal by entering positive territory after a hiatus of almost three months. Thus the short to medium term trend has turned bullish. But the Long term trend still remains Bearish. The other theory is that, the prices have to revert back to the mean atleast two times in a year. The Stock prices had moved far away from the 200dma and now the prices are trying to revert back towards it.

The Indices, Sensex and Nifty, both made a Bearish Engulfing Pattern the day after it closed above the 50dma. It was then over powered by the Bullish Engulfing Pattern that transpired the day after i.e. on Thursday. The Indices then managed to close in the green on Friday, thus confirming a short to medium term trend reversal. The weekly close gives a strong indication of the market momentum for the coming week, which incidentally is also an expiry week. So on can expect strong bout of short covering aided by renewed buying to take the market higher.

The Other Factor: 

SENSEX.

For the week ahead the Resistance is at 10467-10570-10750-10945. Support is at 9785-9633-9281-9095. 

NIFTY.

For the week ahead, the Resistance is at 3161-3198-3240-3328. Support is at 2922-2812-2760-2570.

LAST WEEK’S RECOMMEDATIONS:

Once again we hit Bulls Eye, as we achieved 100% strike once again. Sometimes it becomes boring as we achieve success week after week without any blemish. Good for our readers and followers. 
  • Buy REL CAP 531 Tgt was 564 Reached 569.
  • Buy Adlabs 186 SL 180 Tgt was 194 Reached 198.
  • Buy Bombay Dyeing 182 Tgt was 204 Reached 218.
  • Buy L&T 788 SL 763 Tgt was 820 Reached 844.
  • Buy RNRL 55 SL 51 Tgt was 61 Reached 61.
  • Buy REL 650 SL 618 Tgt was 676 Reached 675.
  • Buy RIIL 385 SL 364 Tgt was 402 Reached 420.

 If one had bought 400 shares of REL and Rel Cap, 2000 shares of ADLABS and Bombay Dyeing, 300 shares of L&T, 4000 shares of RNRL and 500 shares RIIL, then one could have made a profit of Rs. 1,79,500/- in just a week.  

 

Hot Real Estate Stocks:

 

THIS WEEK’S RECOMMENDATIONS: 

WATCH OUT FOR:

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BULLS TAKE CHARGE – 19/12/2008.

Why the Market will Move higher?

The market behaved in exactly the same manner as what we had predicted last time. The Sensex and Nifty both have closed above the very important short term indicator i.e. the 50dma after a very long period. Also the TRIX indicator is showing signs of Bullishness and has given a Buy signal by entering positive territory after a hiatus of almost three months. Thus the short to medium term trend has turned bullish. But the Long term trend still remains Bearish. The other theory is that, the prices have to revert back to the mean atleast two times in a year. The Stock prices had moved far away from the 200dma and now the prices are trying to revert back towards it.

The Indices, Sensex and Nifty, both made a Bearish Engulfing Pattern the day after it closed above the 50dma. It was then over powered by the Bullish Engulfing Pattern that transpired the day after i.e. on Thursday. The Indices then managed to close in the green on Friday, thus confirming a short to medium term trend reversal. The weekly close gives a strong indication of the market momentum for the coming week, which incidentally is also an expiry week. So on can expect strong bout of short covering aided by renewed buying to take the market higher.

The Other Factor:

The other factor obviously is the Rate Cut expected in the second half of the economic stimulus package. The market is expecting a strong Repo and Reverse Repo Rate cut in the coming week and this can be judged by the strong gains registered in the Infrastructure and Property stocks. The drastic fall in Inflation at 6.84% v/s 8.0% last week will definitely help the RBI to take the decision to reduce the Interest Rates. The bounce in these stocks is accompanied by heavy volumes and huge addition in open interest.  

 

SENSEX.

Sensex opened the week at 9821, made a high of 10188, made a low of 9633, and closed the week at 10099, thus registering a weekly gain of 409 points.

The Sensex has managed to close above 50 DMA which is a bullish sign. The short to medium term trend has turned to positive.The indicators like MACD and ROC have now turned positive and indicate strong Bullish up move. The RSI is 58 suggesting gain in momentum.The TRIX indicator has turned positive and is giving a buy signal after a long time. The last time it gave a sell signal was in September when the market was above 15000. The market crashed and went to around 50% of that level. Now, it has given a buy signal, so let us keep our finger crossed.The Sensex has given a break out and is now retracing the fall from 15579 to 7697. The retracement levels are placed at 10707-11638-12568.The Trendline resistance is at 10467 and Trendline support is at 9785-9137.

For the week ahead the Resistance is at 10467-10570-10750-10945. Support is at 9785-9633-9281-9095. 

NIFTY.

Nifty opened the week at 2917, made a high of 3106, low of 2917, and closed the week at 3077. The weekly gain was 156 points.

The Nifty has formed a Bullish Opening White Marubuzo. This indicates strong momentum for next week.Nifty has managed to close above the crucial 50 DMA and thus has changed the short to medium term trend from down trend to up trend.The MACD and ROC are positive and the RSI is suggesting momentum ahead. The TRIX indicator too is giving a Buy signal after three months.Last time we had written that the Nifty will get tested at 3040 and only after breaching that level, can one expect a strong upsurge towards 3161-3198. Now as the weekly close is above that level, we can expect a surge towards 3161-3198.The O.I. PCR is at 1.52 which indicates strong bullish mood in the market. It suggests that more and more Puts are being written as compared to Calls. The Nifty strike of 2900 has seen lot of Put writing suggesting strong support at that level.The Trendline Support is at 2828-2760 and the Trendline Resistance is at 3185-3222.

For the week ahead, the Resistance is at 3161-3198-3240-3328. Support is at 2922-2812-2760-2570.

LAST WEEK’S RECOMMEDATIONS:

Once again we hit Bulls Eye, as we achieved 100% strike once again. Sometimes it becomes boring as we achieve success week after week without any blemish. Good for our readers and followers. 
  • Buy REL CAP 531 Tgt was 564 Reached 569.
  • Buy Adlabs 186 SL 180 Tgt was 194 Reached 198.
  • Buy Bombay Dyeing 182 Tgt was 204 Reached 218.
  • Buy L&T 788 SL 763 Tgt was 820 Reached 844.
  • Buy RNRL 55 SL 51 Tgt was 61 Reached 61.
  • Buy REL 650 SL 618 Tgt was 676 Reached 675.
  • Buy RIIL 385 SL 364 Tgt was 402 Reached 420.

 If one had bought 400 shares of REL and Rel Cap, 2000 shares of ADLABS and Bombay Dyeing, 300 shares of L&T, 4000 shares of RNRL and 500 shares RIIL, then one could have made a profit of Rs. 1,79,500/- in just a week.

Hot Real Estate Stocks:

  • Buy IBReal 159 SL 147 Tgt 178-194.
  • Buy DLF 307 SL 292 Tgt 325-345.
  • Buy HDIL 167 SL 160 Tgt 185-207.
  • Buy Sobha Dev 117 SL 111 Tgt 131-142.
THIS WEEK’S RECOMMENDATIONS:
  • Buy BPCL 385 SL 374 Tgt 400-418.
  • Buy IOC 423 SL 416 Tgt 434-454-469.
  • Buy Essar Oil 94 SL 91 Tgt 102-108.
  • Buy GVK Power 23 SL 21 Tgt 26-29-32.
  • Buy L&T 819 SL 804 Tgt 844-884.
  • Buy Educomp 2727 SL 2650 Tgt 2809-2868.

WATCH OUT FOR:

BPCL - BULLISH ASCENDING TRIANGLE BREAKOUT.

IBREAL- ROUNDING BOTTOM FORMATION.

Disclaimer : The recommendations made herein do not constitute an offer to sell or a solicitation to buy any of the securities mentioned. No representations can be made that the recommendations contained herein will be profitable or that they will not result in losses. Readers using the information contained herein are solely responsible for their actions. Information is obtained from sources deemed to be reliable but is not guaranteed as to accuracy and completeness.

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