9am with Emkay 3 February, 2011

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9am with Emkay

3 February, 2011

n        Technical Comments

5400 – Still intact

After relentless sell-off for 5th consecutive day, Nifty ended with a loss of 88 points. However, Nifty has still managed to hold the 5400-mark, which seems like a major support for time being. As per the “supply and demand” principle the level of 5400 is that point where support equals resistance and hence the previous resistance of 5400 now has a potential to turn into a new support juncture for the market. If we do the momentum analysis; RSI (a key momentum indicator) is in a fairly oversold region, indicating that the bears are losing control on the ongoing downtrend. However, the final confirmation of a short term bounce for the retest of 200-DSMA will creep in only above 5540.

Bank Nifty:

The only positive cue here is that Bank Nifty (currently @ 10482) has not violated its previous swing low 10,384 and with that the possibility of a higher high remains open for this index. Unbroken bullish formation in both hourly and daily MACD makes us believe that we will head higher from current levels.

n        Results Today

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