GOOD MORNING!!!
AFTER GETTING OFF TO A GAP-UP START THIS MORNING TRACKING POSITIVE CUES FROM THE REGIONAL PEERS, THE DOMESTIC EQUITY MARKETS EXTENDED THEIR GAINS IN THE MORNING SESSION. MEANWHILE, THE KEY INDICES WITNESSED A SUDDEN BOUT OF SELLING IN THE MID-MORNING SESSION AFTER FEW MEDIA REPORTS SUGGESTED THAT SOUTH KOREAN MILITARY HAS BEGUN NEW FIRING DRILLS. EARLIER LAST MONTH, NORTH KOREA HAD BOMBARDED ONE OF THE BORDER ISLANDS OF SOUTH KOREA WITH AROUND 200 ARTILLERY SHELLS. IN RESPONSE TO THIS, THERE WAS FIRING FROM SOUTH KOREA AS WELL. START OF NEW FIRING DRILLS BY SOUTH KOREA, IS THE LATEST DEVELOPMENT IN THIS SERIES. THIS NEWS TRIGGERED SHARP SELL OFF ON THE STREET WHICH DRAGGED THE MAIN INDICES TO THEIR DAY’S LOWS. THE MARKETS REVERSED SOME OF THEIR LOSSES IN LATE-MORNING TRADES BUT THEY CONTINUED TO HOVER AROUND THEIR INTRADAY TROUGHS. THE RECOVERY CONTINUED IN THE EARLY-NOON AND LATE-AFTERNOON SESSION. THE BOURSES ONCE AGAIN EXTENDED THEIR LOSSES IN LATE TRADE BEFORE SHOWING SHARP RECOVERY. POSITIVE BEGINNING FOR THE EUROPEAN MARKETS ALSO LIFTED INVESTOR MOOD IN LATE TRADE. THE MARKETS SHOWED ONESIDE UP-MOVE TOWARDS THE END OF THE SESSION. THE BENCHMARK INDICES SCALED THEIR INTRADAY PEAKS IN LAST HALF AN HOUR OF TRADE AND FINALLY LOGGED OFF THE SESSION NEAR THOSE LEVELS. THE MARKET SHRUGGED OFF REPORTS THAT THE SECURITIES & EXCHANGE BOARD OF INDIA (SEBI) PLANS TO MAKE IT MANDATORY FOR COMPANIES TO PROVIDE MORE DISCLOSURES WHEN THEY SEEK TO PLACE SHARES PRIVATELY WITH INSTITUTIONAL INVESTORS AND ALSO FOR BLOCK AND BULK DEALS. AS PER REPORTS, SEBI HAS STARTED TO WORK ON CHANGING THE EXISTING RULES GOVERNING PRIVATE PLACEMENT OF SHARES AND OFF-MARKET TRANSACTIONS AFTER GROWING EVIDENCE THAT PROMOTERS AND MARKET OPERATORS ARE ROUTINELY EXPLOITING LOOPHOLES IN THE REGULATIONS AND RIGGING STOCKS. INDICES EXTENDED THEIR GAINS FOR THE SECOND CONSECUTIVE SESSION ON MONDAY LED BY SMART RECOVERY IN LATE TRADE. POSITIVE GLOBAL CUES ALSO AIDED THE PULLBACK. BARRING FAST MOVING CONSUMER GOODS COUNTER ALMOST ALL THE OTHER SECTORAL INDICES INCHED HIGHER IN TRADE. REALTY, METAL AND POWER STOCKS WERE THE MAJOR GAINERS DURING THE SESSION.
TECHNICAL TAKE: NIFTY HAS CLOSED ABOVE ITS 10-DMA OF 5,904 IN THE LAST SESSION, WHICH IS A POSITIVE INDICATOR FOR THE INDEX IN THE SHORT-TERM. IF THE NIFTY SUSTAINS ABOVE THE 5,904 IT CAN SURPASS THE RECENT HIGH OF 6,070 WHICH WAS MADE ON DECEMBER 6. THE INDEX MAY WITNESS SOME RESISTANCE AROUND 5,954 (50-DMA) AND 6,000 LEVELS. ON THE OTHER HAND, 5,855 (38.20% RETRACEMENT) AND 5,829 (100-DMA) WILL ACT AS STRONG SUPPORT LEVELS.
TODAY NIFTY MAY OPEN SLIGHTLY POSITIVE, IF NIFTY TRADES ABOVE 5948 THEN LIKLEY TO MOVE UP TO 5984. ON THE NEGATIVE SIDE IF NIFTY TRADES BELOW 5920 THEN LIKELY TO SEE NIFTY TO SLIDE DOWN TO 5880 AND THEN TO 5832 AND 5800 ONE HAS TO KEEP IN MIND THAT WE ARE STILL ON A NEGATIVE TREND SO IDEALLY SHORTS ARE BETTER AT THIS STAGE. THOUGH WE HAVE HEADED 200 POINTS FROM THE LOWS OF LAST TWO TRADING SESSION THIS PULL BACK IS ONLY ON THE RETRACEMENT FRONT AND NOT A STRONG BUYING RALLY WE ARE STILL SAILING IN A NEGATIVE WAVE IDEALLY IF YOU LOOK AT THE CHART PATTERNS WE MAY SEE THAT THERE IS FURTHER DOWNSIDE STILL LEFT BEFORE WE TAKE-OFF FROM THE CURRENT POSITION IN THE NIFTY. SO THOUGH THERE IS LITTLE UPSIDE SEEN IN THE MARKETS, THEY MAY NOT REALLY BEHAVE THE WAY THEY ARE LOOKING AT THE MOMENT. I PERSONALLY FORESEE THE MARKETS TO COME DOWN BELOW 5700 LEVELS AND IF THE FALL IN NIFTY IS VERY SWIFT THEN WE MAY LIKELY TO HEAD DOWN TO TOUCH 5500 LEVELS. ON INTRADAY TERMS ONE CAN TAKE BOTH LONG AND SHORT CALLS BUT HAS TO BE WITH THE TREND AND DON’T CARRY LONGS OVER NIGHT TO THE MAXIMUM POSSIBLE LEVELS. IT IS ADVISED TO STAY CAUTIOUS ON LONGS TILL FURTHER NOTICE.
NOTE: STAY CAUTIOUS MARKET IS NOT VERY GREAT TO ADD POSITIONS
