"MARKET OUTLOOK & TRADING IDEA FOR THURSDAY (19.05.2011)"

FIIs were net sellers with the tune of ` 379.44 crore. 

Nifty closed at 5,420.60, down by 18.35 points or 0.34 percent over the previous day closing of 5,438.95, after witnessing a low of 5,401.25 and a high of 5,460.50. Sensex closed at 18,086.20, down by 51.15 points or 0.28 percent over the previous day closing of 18,137.35. It touched an intraday low of 18,020.79 and high of 18,218.20.

The market’s breadth was negative. Out of 2,911 stocks traded, 1,018 stocks advanced, 1,751 stocks declined and 142 stocks remained unchanged. In Sensex, 14 stocks advanced and 16 stocks declined. 

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VIEWS FROM DIFFERENT BROKING HOUSES: 

CANARA BANK SECURITIES (CanMoney): “Technically, Nifty witnessed a weak session, today. After last two session’s big bearish candle, in today’s session, Nifty formed one small bearish candle and closed with marginal cuts. In today’s session Technically Nifty formed third bearish soldier candle.  Nifty maintained the vital supports of 5,420 after touching the physiological level of 5,400. Due to a wide based selling, for the second consecutive day, Nifty closed below its 9, 14, 50 and 100 day’s SMA placed at 5,511, 5,544, 5,644 and 5,648. These levels may act as new resistances in the coming sessions. Owing to selling in the broader indices, bulls once again yielded to the bears and market breadth again slipped into negative. In today’s session, VIX closed at a little lower level of 20.7%, indicating some volatility in market in the forthcoming sessions. RSI (14) for the session was at 35.24 levels and MACD was below the signal line, thus combined together they are giving the signals that, market may witness range bound movements in coming sessions”. 

FAIRWEALTH SECURITIES: “The Nifty has closed below the crucial support of 5465 i.e.2nd day consecutively at 5421 which is again giving the bearish signal and one should take an opportunity to sell at rise if Nifty goes up. Today’s range may be at 5446-5401 with the resistance at around 5465 or the strong resistance will be 5487 and the support for the Nifty exists at 5365/5348. Bank Nifty is trading weak and is expected to see heavy selling pressure below today’s low of 10530”. 

GABA & GABA FINANCIAL ADVISORS PVT LTD (Prakash Gaba): “As expected the market lost some points but taking care to find support near our support of 5400. Technically the market is still weak but is capable of bouncing back and if not, 5348 would be the next logical target. The support for the Nifty is at 5400-5348 and resistance at 5470. The crucial support on the Sensex on the downside is 18032-17834 and resistance at 18256”. 

ANGEL BROKING (Mileen Vasudeo): “Markets opened on a flat note and traded in a narrow range throughout the trading session. The Nifty managed to give a close above the psychological level of 5,400. However, heavy selling pressure was witnessed mainly in midcap counters. In the coming trading session, a relief rally or a pullback towards the levels of 18,331-18,407/5,480-5,500 may attract selling pressure. However, we would still maintain our view that since the daily trend remains down, traders are advised to avoid long positions.  On the downside, 17,878-17,792/5,376-5,348 levels may act as support for the day”. 

IIFL (Amar Ambani): “All eyes will be on L&T results on Thursday. ITC will come out with its numbers on Friday. Meanwhile, a Merrill Lynch survey shows that while global fund managers are increasing their allocation to the emerging markets, India is said to be one of their least favoured markets. FII flows need to turn positive. For that to happen inflation has to moderate meaningfully and the Centre must announce a few bold policy steps”. 

MICROSEC SECURITIES: “Yesterday Nifty traded in the band of 5400 and 5460. Now the crucial support and resistance of Nifty lies at 5350 and 5610 respectively. We expect Nifty to move in the range of 5350 and 5610 in the short term. If it breaks 5350, it may further come down to 5230. However, a breach of 5610 would open the gate for 5760. Traders are advised to maintain stop loss at 5350 of the long positions. On an intra-day basis Nifty has a support at 5400 and is likely to face a stiff resistance near 5460. If Nifty breaks 5400, it may further go down to 5375 and then 5350. However, if it is able to sustain above 5460, the level of 5490–5530 would become the next target”. 

KARVY STOCK:  “The market will take cues from the global markets and is expected to open on a flat to positive note tomorrow. Trade long in Nifty above 5,420 level with stop loss placed at 5,400, targeting 5,450-5,470 levels. Trade short if Nifty fails to cross 5,470 level with stop loss placed at 5,500, targeting lower supports”. 

GEOJIT BNP PARIBAS FINANCIAL SERVICES (Alex Mathews): “Market men are waiting for the diesel and LPG price hike after they could start accumulation. Stock specific movements were seen during the day. The volatility in the second part of the day was due to the fear in investors mind regarding a major fall if the diesel and LPG price are hiked. More over diesel price decontrol which is also on cards, if happens, will play a major role in bring down the market. So investors are staying sidelines. Nifty came close to its crucial psychological support of 5,400 and rebounded from there. The overall outlook is still negative and is lacking directional cues". 

BONANZA PORTFOLIOS (Puneet Kinra): “Nifty showed volatility and traded in range 5,400 to 5,460. Nifty has managed to close above short term important support level of 5,400. If Nifty holds the immediate support of 5,475-5,440 in coming sessions, some recovery may be seen above 5,500-5,530 levels. For daily purpose, the trend deciding level is at 5,475. If Nifty shows strength above 5,475 levels, then rally to 5,530/5,565/5,605 levels may be seen. If Nifty does not show strength above 5,475 levels then selling pressure till 5,420/5,400/5,350 may also be seen". 

EDELWEISS FINANCIAL ADVISORS: “On the lower side Nifty is likely to face strong support in the vicinity of 5380-5400 level, the level (5400) which consists of the highest OI (i.e. 78.14 lacs shares) among the Nifty put options. On the other hand on the higher side Nifty is likely to face strong resistance in the vicinity of 5520-5540 level, the level (5500 which consists of the second highest OI (i.e. 81.80 lacs shares) among the Nifty Call Options”. 

SWASTIKA INVESTMENT: “From last three days black candle is forming in Nifty which is indicating bearish sentiment for Nifty. Nifty is facing a stiff resistance at 5,500. Now Nifty has support at 5,360 and 5,320 where as resistance at 5,450 and 5,500. The trend is seem bearish only if Nifty manage to close above 5,400 level for few days than only some up move could be expected in Nifty. As per Bollinger Band volatility could be seen high in coming session as Nifty is trading near lower band”. 
NIRMAL BANG SECURITIES: “The trend continues to remain weaker as markets are not showing any signs of trend reversal. Sell-off continues to be seen in the index heavyweight stocks which are down 3-5% on the daily basis. The only positive indication is that Nifty is not going below 5400 and some pullback is seen in coming days. Next Important Support for Nifty future seen at 5375-5330 and only below this key level we believe that fresh round of sell-off could be seen, till then any decline can be used as a buying opportunity for a short term trading perspective. Resistance will be seen at 5485-5532”. 

ANGEL BROKING (Daily Outlook): “The trend deciding level for the day is 18,108/5,427 levels. If Nifty trades above this level during the first half-an-hour of trade then we may witness a further rally up to 18,196–18,306/5,454–5,487 levels. However, if Nifty trades below 18,108/5,427 levels for the first half-an-hour of trade then it may correct up to 17,999–17,911/5,394-5,368 levels”. 

INDIRA SECURITIES: “It was flat closing for the markets on Wednesday with certain selective counters like RIL and SBI dragging the markets down. The stocks of retail companies gained on the expectations that the union government would give its nod for foreign direct investment in the sector. For today’s trade, market likely to trade in the range between 5450–5490 in the upper-side and 5390–5350 in the lower-side”. 

BONANZA ONLINE: “Nifty showed volatility and traded in range 5400 to 5460. Nifty has managed to close above short term important support level of 5400. If Nifty holds the immediate support of 5475-5440 in coming sessions, some recovery may be seen above 5500-5530 levels. For daily Purpose, Trend deciding level is 5475. If Nifty shows strength above 5475 levels, then rally to 5530/5565/5605 levels may be seen. If Nifty does not show strength above 5475 levels then selling pressure till 5420/5400/5350 may also be seen”. 

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