NIFTY FIFTY

[AMITBE]

We have lingered in a range for a while now.
2624 is proving to be insurmountable as yet.
The sentiment is tentative though seemingly positive.
Should we consolidate over 2620 for longer, an attempt at 2627-2630 may come later.
But should we break 2620 from a higher level, the fall may have velocity to it.

 

[AMITBE]

We have been attempting to stay above 2620 with a strong selling pressure.
If this is not sustained, expect volatility, and short term supports are at 2619-2616-2610-2608.

Above are support levels from earlier today.

 

[AMITBE]

We have lingered in a range for a while now.
2624 is proving to be insurmountable as yet.
The sentiment is tentative though seemingly positive.
Should we consolidate over 2620 for longer, an attempt at 2627-2630 may come later.
But should we break 2620 from a higher level, the fall may have velocity to it.

So we are breaking past 2630 and with plent of time left still, one hopes this move is sustained.
Else, if we drop from here, 2620 may be broken with some force, and then below the supports are short range merely.

 

[AMITBE]

Coming into the new week post the derivative expiry, we are at an interesting juncture.
There is going to be price discovery in the Indexes and the derivative traded counters on the one hand. On the other, we are now running into the result season. These two factors are going to show the way ahead, price discovery being for the short term.

At some point soon, the midcaps will have to come into play if this rally is to stablise. The ramifications of this are clearly obvious for a better depth and breadth in the market. The ongoing concern has been with volume and breadth, and the participation of the midcaps is vital now. Because these have been beaten down, for the last three to four sessions we are seeing a negative market breadth.

The important thing is we are in a long-term bull -run. There should be a significant amount of portfolio churning happening going forward, as large amounts of funds will be shifting from the fundamentally weak penny stocks as well as low quality mid and small cap stocks to good stocks in this segment. At the same time the NIFTY is showing its capacity to hold on to its recent gains. We are also seeing quite a few front line stocks hitting their 52-week highs. With all this, when we bring in the result season factor, the emerging indication is, there is going to be further rise in the indexes, and the general market sentiment. This is subject to the Midcaps coming into the game.

In the short run, we may see some correction creeping in. There is a lot of profit in the books of those who have participated in the index counters. These should be coming in for profit booking, ready buyers standing by to buy at lower levels notwithstanding. Here would be a chance for the top quality mid, small and perhaps penny counters too, with funds getting relocated.

For the NIFTY now, 2620-2630 has become the vital target, and a step up to 2650 would be the safe zone.
Its quiet likely that we would see lower levels and consolidation there before moving on to test the high ground.

For today, if 2620 at least is not sustained, the supports would come at 2597-2592-2585-2572.
To the up, 2620-2630 are the levels, in if these are sustained, theoretically 2650 is the upper band, even if unlikely.
Will follow up.

Pretty much all the points touched upon this morning have fallen in place today.
The most significant aspect is the way the midcaps have staged a comeback, and sure enough, the breadth, a/d ratio etc have turned favourable. The volume is still weak, but with this boost in sentiment, there is a good chance we will see better volume. Then we are talking of a secular, broad based rally.
The closing is great...on the nose of 2630.
All seems well as of tonight.

 

[AMITBE]

We are at a stage where the next few sessions are vital in giving confirmation of the increasing breadth in the market, which has a direct link to quality midcaps continuing the play witnessed yesterday. There are very many great counters in this segment, and also in smallcaps, that are going cheap after the bashing of the past several sessions, cheap being a relative term.
One hopes we have heard enough of bad-press coming out of SEBI and the like in this vital arena. These are going to be the bigcaps of the future, and these are central to a stable and sustainable growth of the economy, and of the markets.
The signs coming out yesterday were positive, and again, the validation of this has to come in the coming sessions.
It is also likely that we may see some selling coming in the index counters as the portfolios will need to be churned around. As mentioned yesterday, there are substantial profits been made on many of these, and booking profits at this stage, ahead of the result season would be a prudent maneuver. This would fee up liquidity for re-investing at lower levels.
This is the move to watch out for, as the NIFTY could be in a great deal of pressure as selling mounts sometime soon. Should this happen, there should be no call to panic if one is invested in quality mid/small counters, as these are likely to benefit when money gets moved around. Just adhere to good sense and strict s/l levels.
I feel the volatility is going to decrease as we go forward, even when corrections happen. Again this is largely dependant on the midcaps participation. This was seen yesterday after a long spell of volatile sessions.

The levels:
2620 is the pivotal support. and below this there are a few short range supports to 2605 where more weighty support should come. Below this would post as we go along.
To the up, it is important to stay above 2535, a critical resistance area for the last two session. Above, 2645 would be the next level of resistance. If we can sustain 2650 with a good breadth in the market, we are in a very good space.

 

[AMITBE]

The 20 point plus jump so early is not going to be easy to sustain.
There will be pressure now to either sustain 2650, or slip lower to consolidate.
2642 and 2638 are supports at this point.

 

[AMITBE]

In a range so far and now showing signs of tiredness.
The last couple of sessions there has been a rally at closing.
If the opposite were to happen today, supports are at 2655-2652-2350-2646-2642.

 

[AMITBE]

Now that the width and breadth have come back in the market, and the bull run seems firmly intact, what do we need to protect this?
An orderly, un-panicked and a sensible pullback.
This would lead to some good consolidation ahead of the expected fair to good results which would start to come out soon.
The danger signals have been there all along. Extremely over bought NIFTY and a lack of volume to hold it up. We are also into the fifth day on the trot with the indexes gaining ground.
Further, the FIIs have been sellers the last few sessions, with the domestic Funds driving the rally.
Anytime now the Funds would begin to pull out money, and then we would see sell pressure, perhaps except in some sound big and midcaps.
One must keep the s/l levels tight. There are some good moves expected at many good counters, but the correction must come first.
A lot of punters would be buying put calls at higher levels, whether early session should the NIFTY open high and move up, or if it opens flat with a bearish disposition. Keep watch and avoid fresh exposure, and certainly do not chase running stocks.

The levels, 2653 is the hinge support. 2640 would be the danger mark. More levels exist below this, but below 2632, 2620 would be most vital.
To the up, 2670-2680 are the likely peaks should the Bulls continue the party, though unlikely.

 

[AMITBE]

The Nifty is holding close to 2653 as mentioned being the hing level.
This was broken biefly twice so far.
With lower tops and bottoms being made, below 2653, 2647-2649 have held yet, but looking at things, these may not last.
2642 and 2635 have been good supports in the past.

 

[Saint]

The Nifty is holding close to 2653 as mentioned being the hing level.
This was broken biefly twice so far.
With lower tops and bottoms being made, below 2653, 2647-2649 have held yet, but looking at things, these may not last.
2642 and 2635 have been good supports in the past.

Nice one,Amit.....so far bouncing off 2642.