"MARKET OUTLOOK & TRADING IDEA FOR FRIDAY (06.05.2011)"

Nifty closed at 5,459.85, down by 77.30 points or 1.40 percent over the previous day closing of 5,537.15, after witnessing a low of 5,443.65 and a high of 5,560.30. Sensex closed at 18,210.58, down by 258.78 points or 1.40 percent over the previous day closing of 18,469.36. It touched an intraday low of 18,160.65 and high of 18,569.21.

VIEWS FROM DIFFERENT BROKING HOUSES:

FAIRWEALTH SECURITIES: “As it was stated that investors should sell at CMP and every rise because the Nifty is bearish. Now the Nifty is heading towards the level of 5365/5348 for today. Today’s range may be at in between 5506-5445 with resistance 5552 and the support may be at 5411/5365/5348 if the Nifty breached the level of 5445 categorically. Our view for the nifty is still bearish till the level of 5250 is achieved and please go through with our weekly technical view also. In the next session, Bank Nifty is expected to trade in the range 10550-10760. If moved beyond the range 10330 might act as support level while 10909 might be a strong resistance level”.

BONANZA PORTFOLIO (Shanu Goel): “Nifty has given a closing below the crucial level of 5,500, making the intermediate trend along with the short term trend bearish. Further downside from the current level cannot be ruled out”.

GEOJIT BNP PARIBAS FINANCIAL SERVICES (Alex Mathews): “Nifty today witnessed heavy selling below 5,500 and is still weak. The authorities too expect the inflation to move up in coming months as crude price is showing no signs of cooling. Also the diesel price hike expected next week will increase the transportation cost which will be eventually put on the end consumers leading to a rise in the food price inflation as well. Good monsoon rains expected this time is the only factor which gives a hope that good harvest may help the food article’s price under check”.

GABA & GABA FINANCIAL ADVISORS PVT LTD (Prakash Gaba): “.... ‘Technically no sign of strength but the market could see some sluggishness in the weakness and may hold ground here’ the market unfolded weak and tried holding out but could not sustain and cracked…technically no sign of strength as yet but we may see some support coming in closer to 5402 and Friday could turn into a short covering that. The support for the Nifty is at 5402 and resistance at 5560. The crucial support on the Sensex on the downside is 18033 and resistance at 18550”.

ANGEL BROKING (Mileen Vasudeo): “Markets opened on a flat note and traded in a very narrow range during the first half of the session. But in the second half, selling pressure with higher volumes intensified mainly in Realty, Power, FMCG and Banking counters which dragged indices to close near day’s low. Also, indices have breached the upward sloping trend line mentioned in our previous report. On the downside, the near term support levels are at 18,050-17,800/5,400-5,350 and resistance is at 18,340/5,500 level”.

IIFL (Amar Ambani): “The RBI policy moves in the past didn`t damage stocks like the recent one which has managed to rattle the street. The 50 bps hike in policy rates is likely to linger on for a while and the full impact will play out over a period of time. FY12 GDP growth won’t be anywhere near the earlier projection of 9%. Most estimates are hovering around 8-8.5%. Inflation remains the biggest threat. So, any softening on that front will be welcome.  Don’t bet on any meaningful rally from here given the macro-economic headwinds. FII flows too have turned negative over the past few days. At best, there could just be a sideways consolidation in a range but the bias still remains weak. It would be foolish to start buying aggressively at this juncture”.

MICROSEC SECURITIES: “The daily chart of Nifty is showing that it has given a correction of almost 7.3% in a time span of just seven trading sessions. Yesterday it has broken its crucial support 5480. So the downward movement of Nifty might be continuing to 5340. However, the leading indicators (like stochastic) are giving the over sold signal of Nifty. So a short term pull back rally to 5620 can not be ruled out. On an intra-day basis Nifty has a support at 5415 and is likely to face a stiff resistance near 5490. If Nifty breaks 5415, it may further go down to 5370 and then 5340. However, if it is able to sustain above 5490, the level of 5520–5570 would become the next target”.

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. 51.64 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 5550-5600 level, the level (5600 which consists of the third highest addition in OI (i.e. 55.53 lacs shares) among the Nifty Call Options”. 
ANGEL BROKING (Daily Outlook): “The trend deciding level for the day is 18,313/5,488 levels. If Nifty trades above this level during the first half-an-hour of trade then we may witness a further rally up to 18,466–18,722/ 5,532–5,605 levels. However, if Nifty trades below 18,313/5,488 levels for the first half-an-hour of trade then it may correct up to 18,058–17,905/5,416–5,371 levels”. 

BONANZA ONLINE: “Nifty closed on a negative note for 8th continuous session. Bears are having the ball in their hands. Nifty is not respecting any of major support. Further, Friday being last trading day of the week, so volatility may be seen and traders should be cautious. For Daily Purpose, Trend deciding level is 5450. If Nifty shows strength above 5450 levels, then rally to 5500/5550/5600 levels may be seen. If Nifty does not show strength above 5450 levels then selling pressure till 5350/5300/5250 may also be seen”. 

NIRMAL BANG: “Nifty ended almost at it’s day’ low well below 5,500 mark after a long time. The trend is very weak but one needs to be cautious while creating fresh shorts at this level since markets have corrected almost 8% in nine trading sessions. Positive development could be seen only if nifty trades above 5550 until that any rally should be used to cut long positions. Important Support for Nifty future seen at 5415-5390-5370 from where buying could emerge and Resistance at 5489-5515. Bank Nifty @ 10,710 has broken it’s trend line support. Trend is weak and strong support seen at 10,530 and on higher side resistance at 11050”. 

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