19 November 2010

Edelweiss Technical Reflection (ETR): Nov 19th 2010

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Edelweiss Technical Reflection (ETR)
§  Nifty witnessed extreme intraday volatility yesterday after dropping 170 points from day’s high of 6076. In the ordeal, it broke below the crucial 5937 mark, but held on to the 5900 level and recovered the loss to rally back above 6000. It however closed with modest gain below the 6000 mark. Nifty has held on to the channel support line as well as the 55-DEMA (an important medium-term trend pivot). Short-term and intraday momentum oscillators have triggered a buy signal from oversold zone that will lead to a sustained rally in the coming sessions. Market breadth was in favour of declines but improved as compared to previous two sessions. Nifty stocks’ breadth ended neutral at 1:1. The index is expected to extend the relief rally towards short-term resistance of 6100. A close above 6118 (21 DEMA) on a weekly basis will signal a trend reversal in the short-term. 5900 will act as a strong support in the coming days.

§  Stellar rally in Metals and Auto shares helped market gain bullish traction. Banking and Realty shares continued to be a drag on the market. Metals space, both ferrous and non-ferrous has headroom for a 5% rally in the near-term.  Realty shares recovered smartly from a deep correction indicating a short-term reversal on the cards. Bullish Setups: ITC, HNDL, TATA, CIPLA, INFO. Bearish Setups: JSP, BHEL, IVRC

§  Global equities have bounced off smartly from 50 DMAs with gains of ~1-2% in yesterday’s session. German DAX is the first index to make a new high in the current cycle after the short-term corrective move. Currency market moves will continue to dominate the risk asset trade.

§  Interesting chart setupsTATA, LT, ITC, CIPLA, JSP, IVRC



Stocks in News
§  Street hammers SKS after profit warning(Dna)
§  Religare buys IndiaReit fund for Rs400cr(Dna)
§  Gail may raise $420mn from Exim Bank, bond sales(Dna)
§  Sun Pharma gets US .nod gor clarinex, diltiazem ER (Dna)
§  Patni bags Rs145cr contract with 2e2(Dna)
§  Three global firms In race for stakes in Gitanjali sunsidiaries(ET)

Sales Traders Commentary
§  Volatility was the order of the day as the key benchmark indices once again regained positive zone after slipping into the red for a brief period in mid-afternoon trade. Gains in European stocks in early trade aided recovery on the domestic bourses. The Nifty alternatively moved above and below the psychological 6000 level. The market breadth was weak. Metal stocks rose. However, realty and banking stocks fell.
§  The Sensex closed up 0.33% at 19930.64, while Nifty closed up 0.17% at 5998.80.
§  Gainers were Hero Honda Motors (5.46%), Cipla (4.38%), Hindalco Industries (4.06%), Bharti Airtel (3.77%), Tata Steel (2.98%), and Sterlite Industries (India) (2.69%).
§  Losers were Reliance Communications (4.88%), ICICI Bank (3.14%), Jindal Steel & Power (2.13%), Tata Power Company (1.18%), Wipro (0.95%), and Bharat Heavy Electricals (0.92%).
§  The Metal index was up 1.68%. Major gainers were Hindalco Industries (4.06%), JSW Steel (3.54%), Jindal Saw (1.49%), Hindustan Zinc (1.27%), and Sesa Goa (0.69%).
§  The Auto index was up 1.58%. Major gainers were Hero Honda Motors (5.46%), Ashok Leyland (2.43%), Amtek Auto (1.63%), Bajaj Auto (0.64%), and Mahindra & Mahindra (0.31%).
§  The Bankex index was down 1.52%. Major losers were ICICI Bank (3.14%), Indusind Bank (2.96%), Bank Of Baroda (1.33%), Kotak Mahindra Bank (0.83%), and HDFC Bank (0.73%).
§  The Consumer Durables space was down 1.35%. Major losers were Videocon Industries (3.08%), Whirlpool Of India (3.05%), Titan Industries (2.01%), VIP Industries (1.33%), and Blue Star (0.98%).
§  Globally, Asian indices ended firm, while Europe was trading in the green.
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