Market Outlook 25 May 2010 and Calls


Nifty (4943.95) – DOJI

Nifty daily chart has formed “DOJI” with long upper shadow which suggests there is a supply at higher levels and one more point to note here is that on Friday nifty has formed ”Hammer” with long lower shadow so this two combination suggests that market will experience more volatility in coming days  due to abnormal shadow on either side. From last four trading days Nifty is trading below 200 days SMA. We are expecting more volatility with wide range between 4842-5029 levels, and only either side breakout/breakdown provides continuation of trend. Intraday support placed at 4912 – 4880 levels and intraday resistance placed at 4963 – 4987 levels.

Videocon Ind (207.20) - Abandoned Baby

After making high of 250 on 21 April 2010, stock was trading continuously in down trend. Yesterday stock has formed ”Abandoned Baby” a bullish reversal pattern with rising volume on daily chart. Daily momentum indicators after appearing in over sold zone, given positive crossover to signal line. Short term moving averages are also suggesting upward move. Looking at all above technical parameters traders with moderate risk appetite can consider Buy above Rs.209.70 with tight stop loss of Rs.203 on closing basis for a Target of Rs.225.

Bajaj-Auto (2052.45)

After making high of 2223 in mid May 2010, stock has given tired out signal and since then stock is trading with diminishing volume with negative bias, more over yesterday stock has broken ten month old trend line support on daily chart. short term moving averages are showing downward movement and price is trading below 20 days EMA. Daily Momentum indicators as well as weekly RSI also generating sell signal. Looking at all above technical parameters traders with moderate risk appetite can consider Sell below Rs.2050 with tight stop loss of Rs.2075 for a Target of Rs.1995.

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