Nifty Weekly Update for week ended 18th April, 2009.
In the beginning of the week bears were active in nifty and in the last two days bulls came with a vengeance and recovered what ever is lost in the earlier part of the week. With the completion of the week nifty has been continuously raising for the last seven week and the coming week also we might see nifty raising in the earlier part of the week or whole week to complete 8 weeks of continues rise as 8 happens to be Fibonacci we might see the markets correcting larger that that of the previous 8 weeks. If nifty does not fall for next two weeks we might see nifty rising further for another five weeks. So this week we might see nifty raising slightly up and there after correct. As the coming week is the derivatives settlement week, it appears to be a volatile week. So be prepared for the same.
One point to be noted is that nifty has risen above the 200 day moving average after struggling to move above it during the previous week. As nifty has moved above the 200 day EMA we might see long-term funds coming into market as majority of funds will invest only when indices trade above the 200 day EMA. So the closing of indices above the 200 day EMA gives a good opportunity to go long on the market with stop loss at 200 day EMA currently. Another point to be noted is that Relative Strength Index(RSI) has about to give –ve divergence on daily charts and Momentum Index is also showing –ve divergence indicating that nifty has at-least chances of correcting in good way. As the negative divergence is coming at a time when Fibonacci weekly rise of 8 weeks is coming near so we cannot rule out a correction in the coming week.
In the beginning of the week bears were active in nifty and in the last two days bulls came with a vengeance and recovered what ever is lost in the earlier part of the week. With the completion of the week nifty has been continuously raising for the last seven week and the coming week also we might see nifty raising in the earlier part of the week or whole week to complete 8 weeks of continues rise as 8 happens to be Fibonacci we might see the markets correcting larger that that of the previous 8 weeks. If nifty does not fall for next two weeks we might see nifty rising further for another five weeks. So this week we might see nifty raising slightly up and there after correct. As the coming week is the derivatives settlement week, it appears to be a volatile week. So be prepared for the same.
One point to be noted is that nifty has risen above the 200 day moving average after struggling to move above it during the previous week. As nifty has moved above the 200 day EMA we might see long-term funds coming into market as majority of funds will invest only when indices trade above the 200 day EMA. So the closing of indices above the 200 day EMA gives a good opportunity to go long on the market with stop loss at 200 day EMA currently. Another point to be noted is that Relative Strength Index(RSI) has about to give –ve divergence on daily charts and Momentum Index is also showing –ve divergence indicating that nifty has at-least chances of correcting in good way. As the negative divergence is coming at a time when Fibonacci weekly rise of 8 weeks is coming near so we cannot rule out a correction in the coming week.
Elliotte wave: The Elliotte wave analysis of the indices movement is furnished below
The break up of the wave in the current upmove is give above it appears that we might have completed wave A and B and we might be in the process of forming Wave-C which has chances of raising 230 to 400 points from the low of 3300. first target is nearing any move above that will take it to around 3700 levels. Any move below the support line is going to see a healthy correction.Individual stocks:
Power Finance Corporation:Rs.157/-
It appears PFC is technically looking very good at these levels. it can be seen from the above chart that it has moved above the resistance level from at 150 and also the break out is on heavy volumes indicated by a circle. It appears that the stock is on its course to atleast 200 giving a upside potential of 30% if 200 is taken out we might see it moving towards 250 and also all time high. So fundamentally and technically also the stock is a very good buy. Stop loss Rs.135/-Geodesic Ltd – Rs.78/-
It appears from the above chart that geodesic ltd is poised for further upsides in the coming weeks and months. The very very heavy volumes at rise from last two to three weeks suggest that the stock appears to be on its way to Rs.100 any break of the same has chances of it moving towards its intermediate high of Rs.175/- but Rs.100 at this stage appears to be a most probable target giving an 50% upside potential from current level.Voltas Limited – Rs.59/-
It appears from the above that Voltas limited appears to have given a very good technical break out and also see the volumes they are extremely high indicating that some informed investors are slowly coming into the stock and it is going to blast off from the current levels. it appears that the stock is on its way to Rs.75 the Rs.100 and there after to 150/. It is a fundamentally strong company and is technically poised for a good move. So Technically and fundamentally a good buy. Stop loss:Rs.50/-
Directional Momentum index
As indicated in my last weeks update bulls have taken firm grip on the market. DMI has moved from 32 to 39 levels indicating that bulls are still holding upper hand. As the DMI is moving above 40 we can see a huge volatility in the market with upward bias in the market.
M.Sri Mahidar
Sunday, April 26, 2009 8:23:38 PM IST
No comments:
Post a Comment