04 November 2010

Edelweiss Technical Reflection (ETR) : 4th Nov 2010

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Edelweiss Technical Reflection (ETR)
§  For the second day in the week, Nifty opened with a gap up and then traded in a narrow range. Only in the final hour, the index slipped slightly but held on to the gains. It has made yet another small range day indicating high indecision among the traders. The positive is that it has been making a higher top higher bottom formation. Momentum oscillators have flattened after the buy trigger. Market wide breadth turned smartly in favor of advances. Nifty stocks’ breadth too was encouraging at 2:1. Nifty has finally broken above the 6151 barrier and even managed a close above that. This signals a positive trend for the Nifty going forward with targets of 6284 and 6350. Downsides are likely to be protected by 6060 (21 daily EMA).
§  Yesterday’s rally was led by Metal, Auto and Consumer Durables shares and the selling pressure was found in Oil & Gas stocks. Fertilizer stocks have taken off smartly to trigger a short-term rally within a secular long-term uptrend for the sector. Bullish Setups: ESOIL, TATA, LT, ACC, CHMB. Bearish Setups: HDIL, HH, DABUR
§  European markets have been unable to cross above the recent highs as short-term oscillators trigger a sell signal on the daily chart. Across the Atlantic, the SPX has been facing stiff selling pressure from the psychological 1200 mark with a sell signal on short-term oscillator. Crude Oil has broken comfortably above $84 triggering a breakout. Measured target of this breakout is in the range $90-95.
§  Interesting chart setupsTATA, LT, ACC, SESA, HH


Sales Traders Commentary
§  On Wednesday, benchmark indices continued to trade in a range-bound manner. Metal, auto and banking were leading the sectoral space, except oil & gas. The Nifty settled above 6150 level, and could be ahead of the likely announcement of quantitative easing in FOMC meet today evening and Coal India listing tomorrow.
§  Sensex closed at 20465, up 120 points and the Nifty was at 6160, up 41.5 points.
§  Gainers were Sterlite Industries (India) (3.74%), Tata Motors (2.95%), ACC (2.46%), State Bank Of India (2.25%), Jindal Steel & Power (2.16%), and Tata Steel (1.95%).
§  Losers were Jaiprakash Associates (0.80%), Reliance Industries (0.73%), Cipla (0.64%), Tata Power Company (0.54%), Reliance Communications (0.52%), and DLF (0.33%).
§  The Metal index was up 1.75%. Major gainers were Jindal Steel & Power (2.16%), Hindalco Industries (1.23%), Hindustan Zinc (0.44%), National Aluminium Company (0.26%), and JSW Steel (0.04%).
§  The Auto index was up 1.24%. Major gainers were Apollo Tyres (3.97%), Exide Industries (2.14%), Bajaj Auto (1.74%), Amtek Auto (1.37%), and Hero Honda Motors (0.97%).
§  The Bankex index was up 1.13%. Major gainers were ICICI Bank (1.18%), Canara Bank (0.84%), Bank Of Baroda (0.52%), HDFC Bank (0.33%), and Federal Bank(0.03%).
§  The Oil & Gas index was down 0.37%. Major losers were Bharat Petroleum Corporation (1.25%), Hindustan Petroleum Corporation (1.04%), Essar Oil (1.03%), and Reliance Industries (0.71%).
§  Globally, Asian markets ended lower, While European indices were trading higher.

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