Archives : SENSEX - 19681 & NIFTY - 5915 CRITICAL RESISTANCE. 30/11/2007
SENSEX-19681 & NIFTY-5915 CRITICAL RESISTANCES.- 30/11/2007
It was settlement week and it passed off smoothly. It was volatile and yet range bound. Nifty trading ranged from 5600 to 5800, a range of only 200 points. Going ahead this range will be broken. 19681 for the Sensex and 5915 for the Nifty will be critical resistance in the coming week. If the markets are able to conquer them and close above then we can surely hope the markets to march towards Sensex 20000 and Nifty 6000. Till then be cautious.
- ONCE AGAIN ALL EYES ON FED.
- SHORT POSITIONS ROLLED OVER.
- HOW TO TRADE?
- LAST WEEK’S RECOMMENDATIONS:
- THIS WEEK’S RECOMMENDATIONS:
ONCE AGAIN ALL EYES ON FED.
Fed is meeting next week and traders are once again expecting a rate cut. US economy is weakening and the Fed is expected to give it a booster shot by again cutting rates. The Fed has no choice but to cut the interest rate, as the data concerning the US economy continue to show weakness. Bears will do well to remember, when the FED cut interest rates by 50 bps last time, and as a result our market rose from 15500 levels to 20000 levels. So if the FED surprises the market by cutting interest rate more than expected, then the dollar deluge will once again grip the Indian bourses.
SHORT POSITIONS ROLLED OVER.
Market wide rollover for the December series was 83% as compared to 85% in November series. Nifty rollover was 76% as compared to 71% at the start of the previous month. Nifty futures started this month with a premium of 48 points as compared with a discount of 34 points during the last week. Short positions in the IT sector were rolled over to the Dec series. Short positions in the RPL futures were left to expire and as a result rollover to the Dec series was low, just around 50% v/s 85%. Strong rollover was seen in stocks like IFCI, Hindalco, and the banking sector in general.
Sensex opened the week at 19171, made a high of 19424, low of 18884 and closed the week at 19363. Thus the weekly gain for the Sensex was 511 points. Sensex will face critical trendline resistance at 19681 level, and if it is able to close above that then the next target for Sensex will be 20000. There is a trendline support at 18487. In the event of a fall, the support will be provided by the 50 DMA, which is at 18647. The Sensex is moving in a range of 1200 points 18500 to 19700, and this range will be broken this week. For the week ahead the resistance is at 19681-19971-20238. Support is at 19006-18884-18647-18487.
Nifty opened the week at 5611, made a high of 5782, low of 5595 and closed the week at 5762. The weekly gain for the Nifty was 154 points. Nifty faces an important trendline resistance at 5915 and if it closes above that then it can go on to test the previous high. There is a trendline support at 5616. The 50 DMA is placed at 5500, which will act as a good support in the case of a fall. The Nifty futures closed the week with a premium of 28 points. The Nifty OI PCR is at 1.34. Lot of put writing is observed at the strikes of 5600 and 5500 strikes, which will act as a support in case of a fall. Lot of call writing is seen at the strikes 5900 and 6000 which will act as resistance going ahead. For the week ahead the resistance is at 5915-5981-6012. Support is at 5632-5595-5500.
HOW TO TRADE?
One can buy Neyvelli lignite future and hedge it with selling Nifty futures. Neyvelli Lignite is at 235, targets are 248-261. Also one can construct a Bull Call Spread for Balrampur Chini 100 target is 114.
LAST WEEK’S RECOMMENDATIONS:100 % SUCCESS, once again we hit bull’s eye with all scripts achieving their targets.
JINDAL STEEL & POWER 12105 TGT WAS 13429, REACHED 14560 !!!
WELSPUN GUJ 398 TGT 418 REACHED 426.
NEYVELLI LIGNITE 214 TGT 227 REACHED 241.
ESCORTS 147 TGT 167 REACHED 169.
RPL 209 TGT 222 REACHED 225.
NTPC 236 TGT 245 REACHED 245.
TCS 960 TGT 1007 REACHED 1018.
THIS WEEK’S RECOMMENDATIONS:
- EDUCOMP 3583 SL 3510 TGT 3708-3816-4195.
- ALOK IND 76 SL 69 TGT 83-86.
- BALRAMPUR CHINI 100 SL 96 TGT 107-114.
- NEYVELLI LIGNITE 235 SL 226 TGT 248-261.
- GITANJALI GEMS 436 SL 423 TGT 448-462-495.
- LANCO INFRA 531 SL 515 TGT 545-565-620.
- ROLTA 733 SL 705 TGT 770-838.