End of 1st phase of Bear Cycle
We look to come to an end of the 1st phase of Bear cycle. A correction of 20% starting anytime cannot be ruled out. And for the next 3months, equities will be allowed to take some rest to prepare for the next phase.
In the mean time, where will the capital go?? The answer is commodities. Crude, the premier target. $91 soon. If breaks 92-95 then we are going in for some major downturn. Expect 140 soon. Mostly, looks like upside capped at 91 but IF crosses 95 and rallies then this time, crude may goto 140-155 and we may head lower than March lows(equities).
Stocks that are good: Let the market correct and stocks which are into mining, oil exploration and Importers of goods and services(Dollar index looks to be a great shorting oppurtunity)
All the things have happened in a series, first Large cap gave their bit, then midcaps and then small caps. Seeing that people have been motivated by the exposure in the markets.
This phenomenan is not only common in bear markets but also in bull markets. Its a cycle that goes on in every market of the world.
There is a second thoughts to this study as we have elections round the corner. Exhaustion patterns are visible like the ones when nifty was at 5700. Exhaustion looked but we ran upto 6300 only to correct at higher levels. Or we can go down from here also.
Comments and views welcome
Wednesday, June 17, 2009
Possibile Directions to the Market after Elections
Possible Directions to the market after Elections
If we dont consider fundamental news and purely on technicals. (Things have been divided on positive movement and negative movement)
Positive:
Probability 1
If nifty opens below 3695 and goes on to cross 3730 then we can see something 3770 3830. Crossing 3830 is very difficult. this would open a target of 4000 4500 on nifty.
Possibility 2
We open gap up above 3730. Then we may have a rally for 3770 3830 but a drastic fall to 3400 would not be ruled out.
Negative
Possibility 1
We open gap down till 3630 and continue our slide downwards. Breaking of 3529 will give us a target of 3328 and 3000.
Possibility 2
We open gap down below 3598 and continue our slide downwards. breaking of 3529 will give us a target of 3476 3328. But most probably we would recover from 3476 and would give a very strong pullback to 3630 levels.
If we dont consider fundamental news and purely on technicals. (Things have been divided on positive movement and negative movement)
Positive:
Probability 1
If nifty opens below 3695 and goes on to cross 3730 then we can see something 3770 3830. Crossing 3830 is very difficult. this would open a target of 4000 4500 on nifty.
Possibility 2
We open gap up above 3730. Then we may have a rally for 3770 3830 but a drastic fall to 3400 would not be ruled out.
Negative
Possibility 1
We open gap down till 3630 and continue our slide downwards. Breaking of 3529 will give us a target of 3328 and 3000.
Possibility 2
We open gap down below 3598 and continue our slide downwards. breaking of 3529 will give us a target of 3476 3328. But most probably we would recover from 3476 and would give a very strong pullback to 3630 levels.
Fibonacci supports and resistance For 18-06-2009
FIBONACCI LEVELS
18 JUNE 2009
ABOUT FIBONACCI LEVELS:
Fibonacci levels are basically Support and Resistance levels generated using 5-day’s chart (i.e) 5 day’s High, Low and Close. Hence they are more accurate than Pivot levels which are generated using previous day’s High, Low and Close.
Generally stocks look bullish above the previous day’s High and bearish below previous day’s Low. So Previous Day’s high is the minor resistance (MIR) for the scrip and the Previous Day’s low is the minor support (MIS) for the scrip.
Stocks look strong above the 5-day’s High and weak below 5-day’s Low. So Previous 5-day’s high is the major resistance (MR) for the scrip and the 5-day’s low is the major support (MS) for the scrip.
So,
MR INDICATES MAJOR RESISTANCE- 5 DAY’S HIGH
MS INDICATES MAJOR SUPPORT- 5 DAY’S LOW
MIR INDICATES MINOR RESISTANCE- PREVIOUS DAY’S HIGH
MIS INDICATES MINOR SUPPORT- PREVIOUS DAY’S LOW
SCRIP LOOKS BULLISH ABOVE PREVIOUS DAY’S HIGH
SCRIP LOOKS STRONG ABOVE 5 DAY’S HIGH
SCRIP LOOKS BEARISH BELOW PREVIOUS DAY’S LOW
SCRIP LOOKS WEAK BELOW 5 DAY’S LOW
LTP is the Last Traded Price for the scrip
HOW TO USE IT:
For e.g. For Aban Offshore June Futures LTP is 3480 .MS is 3235 which is the major support below which the stock is extremely weak and MR is 3579 which is the major resistance above which the stock is extremely strong.
Suppose the stock currently trades at 3510, above 3512 long position can be built for the first target of 3579 and if it cuts 3579 it can go up to the second target of 3645 and the stop loss can be placed at 3473. Since the trend is sideways it becomes bullish after it cuts 3505(MIR) and becomes extremely strong after it cuts 3579(MR) levels
Download this file
http://www.4shared.com/file/112406709/5ac2160f/Fibonacci_Support_and_Resistance_18062009.html
18 JUNE 2009
ABOUT FIBONACCI LEVELS:
Fibonacci levels are basically Support and Resistance levels generated using 5-day’s chart (i.e) 5 day’s High, Low and Close. Hence they are more accurate than Pivot levels which are generated using previous day’s High, Low and Close.
Generally stocks look bullish above the previous day’s High and bearish below previous day’s Low. So Previous Day’s high is the minor resistance (MIR) for the scrip and the Previous Day’s low is the minor support (MIS) for the scrip.
Stocks look strong above the 5-day’s High and weak below 5-day’s Low. So Previous 5-day’s high is the major resistance (MR) for the scrip and the 5-day’s low is the major support (MS) for the scrip.
So,
MR INDICATES MAJOR RESISTANCE- 5 DAY’S HIGH
MS INDICATES MAJOR SUPPORT- 5 DAY’S LOW
MIR INDICATES MINOR RESISTANCE- PREVIOUS DAY’S HIGH
MIS INDICATES MINOR SUPPORT- PREVIOUS DAY’S LOW
SCRIP LOOKS BULLISH ABOVE PREVIOUS DAY’S HIGH
SCRIP LOOKS STRONG ABOVE 5 DAY’S HIGH
SCRIP LOOKS BEARISH BELOW PREVIOUS DAY’S LOW
SCRIP LOOKS WEAK BELOW 5 DAY’S LOW
LTP is the Last Traded Price for the scrip
HOW TO USE IT:
For e.g. For Aban Offshore June Futures LTP is 3480 .MS is 3235 which is the major support below which the stock is extremely weak and MR is 3579 which is the major resistance above which the stock is extremely strong.
Suppose the stock currently trades at 3510, above 3512 long position can be built for the first target of 3579 and if it cuts 3579 it can go up to the second target of 3645 and the stop loss can be placed at 3473. Since the trend is sideways it becomes bullish after it cuts 3505(MIR) and becomes extremely strong after it cuts 3579(MR) levels
Download this file
http://www.4shared.com/file/112406709/5ac2160f/Fibonacci_Support_and_Resistance_18062009.html
password for file is " http://dailytradereports.blogspot.com/ "
Research- Today view
FII's are continuous sellers for the past 3 days because there is a PROPOSAL to bring lock in period for FII investments in INDIA
9:46 AM 6/15 RESEARCH -Nifty (FUT) R-4625/4675/4755 S-4535/4485/4355 ; Sensex (CASH) R-15340/15500/15765 S-15075/14910/14485 ; MARKET OUTLOOK: RANGE BOUND
9:47 AM 6/15 RESEARCH-Global Market (in %): DOW JONES (+0.32%), S&P 500 (+0.14%), NASDAQ (-0.19%), FTSE (-0.45%), DAX (-0.74%), NIKKEI (-0.94%), HANG SENG (-1.57%) & SGX NIFTY (-56 POINTS)
9:47 AM 6/15 RESEARCH -ADRs: ADRs: Satyam Computers (-14.65%), MTNL (-7.54%), Wipro (-4.88%) and Tata Comm. (-4.04%)
10:39 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : JKLAKSHMI CMP 109.65 TGT 116 SL 107
10:46 AM 6/15 RESEARCH : INTRADAY CALL (CASH): BUY DLF ABOVE 371 TGT 385 SL 365
10:46 AM 6/15 RESEARCH : INTRADAY CALL ( CASH ) : BUY JSW STEEL ABOVE 694 TGT 718 SL 683
10:47 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : BUY RANBAXY CMP 291.5 TGT 308 SL 283
10:49 AM 6/15 RESEARCH : INTRADAY CALL ( CASH ) : BUY HDIL ABOVE 260 TGT 270 SL 255
10:54 AM 6/15 RESEARCH : INTRADAY CALL ( CASH ) : BUY LITL ABOVE 390 TGT 405 SL 382
10:56 AM 6/15 FUNDAMENTAL CALLUY JP ASSOCIATE CMP 215.60 TARGET 225 SL 205
10:57 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : BUY DEEPAK FERT ABOVE 95 TGT 99.75 SL 92.45
11:00 AM 6/15 RESEARCH : INTRADAY CALL (CASH): BUY ABAN ABOVE 1027 TGT 1058 SL 1011
11:03 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : BUY IOB CMP 84.20 TGT 89.4 SL 81.5
11:22 AM 6/15 RESEARCH : INTRADAY CALL (CASH): BUY RCOM ABOVE 339 TGT 354 SL 334
9:46 AM 6/15 RESEARCH -Nifty (FUT) R-4625/4675/4755 S-4535/4485/4355 ; Sensex (CASH) R-15340/15500/15765 S-15075/14910/14485 ; MARKET OUTLOOK: RANGE BOUND
9:47 AM 6/15 RESEARCH-Global Market (in %): DOW JONES (+0.32%), S&P 500 (+0.14%), NASDAQ (-0.19%), FTSE (-0.45%), DAX (-0.74%), NIKKEI (-0.94%), HANG SENG (-1.57%) & SGX NIFTY (-56 POINTS)
9:47 AM 6/15 RESEARCH -ADRs: ADRs: Satyam Computers (-14.65%), MTNL (-7.54%), Wipro (-4.88%) and Tata Comm. (-4.04%)
10:39 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : JKLAKSHMI CMP 109.65 TGT 116 SL 107
10:46 AM 6/15 RESEARCH : INTRADAY CALL (CASH): BUY DLF ABOVE 371 TGT 385 SL 365
10:46 AM 6/15 RESEARCH : INTRADAY CALL ( CASH ) : BUY JSW STEEL ABOVE 694 TGT 718 SL 683
10:47 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : BUY RANBAXY CMP 291.5 TGT 308 SL 283
10:49 AM 6/15 RESEARCH : INTRADAY CALL ( CASH ) : BUY HDIL ABOVE 260 TGT 270 SL 255
10:54 AM 6/15 RESEARCH : INTRADAY CALL ( CASH ) : BUY LITL ABOVE 390 TGT 405 SL 382
10:56 AM 6/15 FUNDAMENTAL CALLUY JP ASSOCIATE CMP 215.60 TARGET 225 SL 205
10:57 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : BUY DEEPAK FERT ABOVE 95 TGT 99.75 SL 92.45
11:00 AM 6/15 RESEARCH : INTRADAY CALL (CASH): BUY ABAN ABOVE 1027 TGT 1058 SL 1011
11:03 AM 6/15 RESEARCH: SHORT-TERM FUNDAMENTAL CALL : BUY IOB CMP 84.20 TGT 89.4 SL 81.5
11:22 AM 6/15 RESEARCH : INTRADAY CALL (CASH): BUY RCOM ABOVE 339 TGT 354 SL 334
Money Morning 17-06-2009
Wall Street extended the pullback on Tuesday after news of a seventh
straight monthly drop in industrial production overshadowed better-thanexpected
reports on home construction, building permits and inflation.
While Dow Jones fell 1.25%, NASDAQ plunged by 1.11%. Asian
bourses are trading in the mixed with Nikkei up by 0.40%, Hang Seng
down by 1.39% and Singapore Nifty down by 27 points.
Though global cues point to possible negativeness, considering
technical aspects the domestic bourses might trade range bound for the
day. Technically spot nifty may take resistance at 4570/4620/4750
levels and support at 4435/4355/4225 levels.
POST-MARKET ANALYSIS:
Though, following negative global cues markets opened gapped down,
they soon recovered with buying seen in banking, PSU, power and
metal stocks. The key benchmark indices Sensex and Nifty gained
marginally by 0.55% and 0.75% respectively.
FIIs’ were net sellers both in equity and derivatives.
ADRs: Satyam Computers. (+13.95%), Patni Computers (-4.31%),
Sterlite Ind. (-3.63%) and Wipro (-3.51%)
NEWS TO USE:
Positive
POWER GRID standalone net profit increased by 16.72% (YoY) to
Rs.1690.61 crore for FY09. Net sales rose by 44.66% (YoY) to
Rs.6675.85 crore.
IVRCL INFRA’s buildings, power and roads divisions has bagged
several orders valued at Rs 432.36 crore, including structural works
from the Uranium Corporation of India Ltd (UCIL) for their upcoming
project in Andhra Pradesh.
TITAN INDUSTRIES has set a goal of crossing the USD 1-billion
turnover in the current fiscal.
DR REDDY’S (DRL) has announced a partnership with
GLAXOSMITHKLINE (GSK) Plc to develop and market select products
across emerging markets outside India. Under the terms of the
agreement GSK will gain exclusive access to more than 100 branded
pharmaceuticals of DRL.
The merger of Catholic Syrian Bank with FEDERAL BANK is expected to be through in a month.
NEUTRAL
After the Nano and the World Truck, TATA MOTORS is readying for yet another big-ticket launch. This
time, it will be on a ‘crossover’ sports utility vehicle (SUV) platform.
The Ministry of Petroleum and Natural Gas issued orders directing Reliance to sell 3.75 metric million
standard cubic metres per day (mmscmd) of gas to ESSAR STEEL, ISPAT STEEL AND VIKRAM
ISPAT.
RELIANCE NATURAL RESOURCES LTD (RNRL) has joined the race to hire the LNG terminal
adjacent to the Dabhol power plant to import liquefied natural gas (LNG) cargoes.
OPTO CIRCUITS INDIA LTD is planning to develop a single-product special economic zone (SEZ) at
Hassan at an investment of close to Rs 150 crore.
The construction work for the proposed 15 million tonne per annum (mtpa) refinery of the INDIAN OIL
CORPORATION LTD (IOCL) at Paradeep is expected to start in the first quarter of 2010-11.
CENTRAL BANK OF INDIA and ASHOK LEYLAND signed an agreement to provide loans for
commercial vehicles. Under the tie-up, Central Bank of India will provide loans for Ashok Leyland’s
customers at 100 basis points below its benchmark prime lending rate till March 31, 2010.
SESA GOA is looking to raise about Rs 583 crore through issue of shares to the firm's promoters and
its associates.
JUBILANT ORGANOSYS LTD is looking at selling off its non-core business of industrial performance
polymers.
TradeDaily Currency Reports 17-06-2009
Global Markets:
The U.S. dollar fell across the board on Tuesday, pressured by
Russian angling for a new global reserve currency, while stocks
fell on renewed worries whether the ailing world economy was
on the path to recovery. Oil gave back early gains as the dollar
strengthened while U.S. Treasury bond prices rose after the
Federal Reserve bought a surprisingly large $6.5 billion in government
debt.
Concerns that the pace of economic recovery may be more
tepid than initially thought, forced a retreat in a broad equity
advance in Europe and the United States.
While U.S. housing starts in May rebounded and producer prices
rose less than expected, suggesting inflation pressures were
muted, another report showed industrial production logged a
steeper-than-expected slide last month. A Federal Reserve report
also said the capacity utilization rate in May for total industry,
a measure of slack in the U.S. economy, slumped to its lowest
on records dating back to 1967.
Other markets also flipped around midday as the perceived outlook
for the U.S. economy turned darker. The Dow average
closed down 107.46 points, or 1.25 percent, at 8,504.67.The
mixed bag of data was seen as positive for bonds, a traditional
safe haven, as it suggested there are ample hurdles the economy
must overcome before the recession can end.
The dollar fell on comments by Russian President Dmitry Medvedev
suggesting a need for a global reserve currency other than
the greenback. Gold rose in Europe, benefiting from its appeal as
a hedge against potential inflation on the upturn in crude prices.
Copper ended down as investors worried that a recent sharp
run-up in commodity prices might have exceeded fundamentals
in the face of the mixed economic data.
The INR: View Point
The Indian rupee recovered some of its early losses on
Tuesday, helped by fall in the dollar versus major currencies
and a rise in the domestic share market which raised
hopes for more foreign fund inflows. The dollar index, a
gauge of the U.S. unit's performance versus majors, was
down 0.9%, after what was seen as dollar-negative comments
from Russia again. One-month offshore nondeliverable
forward contracts were quoting at 47.91/48.01,
weaker than the onshore spot rate, indicating a slightly
bearish outlook in the near term.
However if the “correlation” of the Rupee with the USDX
is “true”- and as we see clear evidence that the USDX is
set to strengthen, then we may expect the Rupee to
weaken too in the interim. Therefore we need to see how
the resistance at 47.90-48.05 holds up. Over this mark, the
move could extend to at least 48.40-50.
We have shown below, how the inverted H&S formation
has been possibly triggered and now it is likely to be in a
trending mode higher. Therefore we may expect the 47.50
support to hold and become the base for a higher Dollar.
The U.S. dollar fell across the board on Tuesday, pressured by
Russian angling for a new global reserve currency, while stocks
fell on renewed worries whether the ailing world economy was
on the path to recovery. Oil gave back early gains as the dollar
strengthened while U.S. Treasury bond prices rose after the
Federal Reserve bought a surprisingly large $6.5 billion in government
debt.
Concerns that the pace of economic recovery may be more
tepid than initially thought, forced a retreat in a broad equity
advance in Europe and the United States.
While U.S. housing starts in May rebounded and producer prices
rose less than expected, suggesting inflation pressures were
muted, another report showed industrial production logged a
steeper-than-expected slide last month. A Federal Reserve report
also said the capacity utilization rate in May for total industry,
a measure of slack in the U.S. economy, slumped to its lowest
on records dating back to 1967.
Other markets also flipped around midday as the perceived outlook
for the U.S. economy turned darker. The Dow average
closed down 107.46 points, or 1.25 percent, at 8,504.67.The
mixed bag of data was seen as positive for bonds, a traditional
safe haven, as it suggested there are ample hurdles the economy
must overcome before the recession can end.
The dollar fell on comments by Russian President Dmitry Medvedev
suggesting a need for a global reserve currency other than
the greenback. Gold rose in Europe, benefiting from its appeal as
a hedge against potential inflation on the upturn in crude prices.
Copper ended down as investors worried that a recent sharp
run-up in commodity prices might have exceeded fundamentals
in the face of the mixed economic data.
The INR: View Point
The Indian rupee recovered some of its early losses on
Tuesday, helped by fall in the dollar versus major currencies
and a rise in the domestic share market which raised
hopes for more foreign fund inflows. The dollar index, a
gauge of the U.S. unit's performance versus majors, was
down 0.9%, after what was seen as dollar-negative comments
from Russia again. One-month offshore nondeliverable
forward contracts were quoting at 47.91/48.01,
weaker than the onshore spot rate, indicating a slightly
bearish outlook in the near term.
However if the “correlation” of the Rupee with the USDX
is “true”- and as we see clear evidence that the USDX is
set to strengthen, then we may expect the Rupee to
weaken too in the interim. Therefore we need to see how
the resistance at 47.90-48.05 holds up. Over this mark, the
move could extend to at least 48.40-50.
We have shown below, how the inverted H&S formation
has been possibly triggered and now it is likely to be in a
trending mode higher. Therefore we may expect the 47.50
support to hold and become the base for a higher Dollar.
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