Newsletter 16 April 2008

16-April-2008
Nifty Support Level 4850 and Resistance Level 4950-70.

MARKET WATCH
Markets defied the negative global cues as it moved up strongly after a sluggish opening.
Infosys numbers did not prove to be a deterrent as they were on more or less expected lines. It did however, revved up the IT sectors as the other stocks both heavyweights as well as mid caps reacted in a positive manner to the Infosys numbers. TCS was up more than 8% while others like Wipro, HCL Tech, Tech mahindra, Satyam, 3i infotech and Mphasis too moved up sharply. R-group continued to move higher and it was the turn of ADA group stocks to show momentum. R-Power was the star as it added more than 7% while others like RNRL and Rcom too registered sharp gains. RPL and RIL continued to lead the markets as both moved up smartly. In fact, the oil and Gas sector remained the best performing one. Other stocks from the sector to move up smartly were Essar Oil, ONGC, Hind Oil and Selan Exploration. Cairns met with some profit taking at higher levels and was the only notable loser from this sector. Other stocks that closed in the red were Zee Tele, Ind Cement, Great Offshore, DCB, Sesa Goa and Crompton. Overall it was a good day for the markets. Breadth was positive while the volumes were also better than the past few days.

Nifty managed to move up sharply from the lows of the day and is now in the vicinity of the higher side of the range. (4620-4950). Again, the momentum is suggesting a breakout on the upper side but as traders we must wait for this to actually happen. Sustained trading above 4950 could open up the possibility of Nifty moving to around 5250 in coming days. Essar Oil has moved past 260 and has broken out from around 12 weeks range. It could target 295-300 in coming days. More upside is also seen in RNRL (above 107), REL, Tech Mahindra, Bajaj Hind, Tata Steel (above 705), Rolta (above 299), MRPL (above 93), Neyvelli and JP associates (above 223).
Research

HOLDING PERIOD – ONE to FIVE DAYS
TATA STEEL FUT BUY ABOVE 705 STOP LOSS 698 TARGET 716/???
RNRL FUT BUY ABOVE Rs 106.50 STOP LOSS 104. TARGET111.25/???
ROLTA FUT BUY ABOVE 299.50 STOP LOSS 294 TARGET 308/314

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