MARKETS VIEW CONTINUES TO BE POSITIVE
The markets continued to remain range bound throughout the week and despite bouts of selling seen on profit booking last week, the NIFTY continued to witness positive sentiments on continued buying from the FIIs which has been the single most factor responsible to keep the market on a upward bias.
The NIFTY closed the week at 5439 levels from previous weeks level of 5367 showing a gain of around 1.3% WoW.
We continue to believe that domestic markets are likely to remain range bound in the near term and with good buying coming in from FIIs there is a strong possibility of the NIFTY crossing 5500 levels soon. Global news flows are expected to be by and large on anticipated lines and we believe that unless there is any significant negative economic or corporate event in the near term, the markets here are unlikely to turn negative.
In fact if the present trend of sustained FII buying in our markets continues and global markets remain in a fine shape, the broad direction for our markets continue to be with a upward bias.
We continue to remain positive on the markets and expect strong for NIFTY at 5350 levels while on the upside, the NIFTY has a resistance at around 5515 in the near term.
TECHNICAL VIEW: STATY LONG WITH THE STOP LOSS OF 5349
The technical view on the market continues to be positive. Nifty, by taking a support near the previous bottom of 5353 has made a double bottom formation, implying that there is a strong support around 5350, a sustained trading below will end the ongoing uptrend. Cutting/Hedging of long position should be the strategy if that happens. The support levels to watch out on the downside would be 5213, 5131 and 5050 which are 38.2%, 50% and 61.8% retracement levels of the rally from the bottom of 4786 to the top of 5477. On the upside, the trend-line adjoining tops of January and April 2010 presents a resistance around 5515 as shown in the weekly chart of Nifty below, and will be the immediate target for the benchmark. A sustained crossover of 5515 would be a significant breakout and would lead the Nifty to next level of around 5670, where the trend-line adjoining tops of October 2009 and January 2010, presents a resistance.
