You must read previous articles and
watch the given chart carefully to understand this article completely.
Today’s outlook: -
Nifty has saved 5838 again and it
kept on trading in an extremely narrow trading band. I can sense that it was
hope of rate cut which was saving this market. There are some signs of
tiredness. Now, market seems to be moving only after RBI’s monetary policy
review.
Fair expectation is – 25 basic point
CRR cut. Repo rate – remains unchanged.
Wave charts are suggesting that this
is a phase of consolidation. We can see this market consolidating for few more
days. I need to add that as long a 5838 saves we cannot say for anything good
on profit taking. There is some crucial development on technical indicators. MACD
has given a sell signal, which I kept on discussing from past few trading
sessions.
This is a critical phase after a
sharp rally from 5548 marks. One by one, many indicators has given sell signal
but those put only a pause in the market. Unless we drift below 5838-5815 zones
we cannot say that profit taking is acceptable.
Alter views suggest that if it kept
on saving 5838 (which not a likely situation) then we can see another wave
extension. In my view, globe may enjoy Santa rally but Indian market might be
laggard if market takes RBI policy as disappointment. (Note that I am saying
about the way market takes, market must be focusing on wording too. Sometime even
no rate cut were able to bring cheer and sometime even rate cut can disappoint.
This is not a time for guess work).
I like to draw your attention
towards one more factor. Government is supposed to present land bill and
pension bill in the parliament today. We need to see the hue and cry over ‘reservation
bill’. SP has decided to take its action in Lok sabha. I need to say that UPA
is taking the benefit of tussle between two regional parties. With every single
bill, this government is loosing one partner. I am not raising any question
marks on government stability but this is not a good trend and political uncertainty
next year.
Conclusion Nifty: It is saving 5838 yet. I am still
saying that near to 5850, it is better to wait for the break of 5838 for better
confirmation. Technical resistance will at 5888 < 5912. Suppose if it breaks
5838 then only it can open scope of 5770 which I have indicated few days back. Nifty
December future has also saved 5880 with a margin of one point. It has happened
as premium was reducing yesterday. Charts are still suggesting for likely fall
in index if and only if levels break. If not, then another dull day.
S&P 500 – It seems that S&P 500 may
give a Santa Rally on year end with hope of some positive solution coming about
fiscal cliff. From a point of 1432, it will have stiff technical resistance at
1445. In my view, US
Regards,
Praveen Kumar
