The domestic Indian markets opened higher but then saw selling pressure and losses throughout the day. Better than expected industrial production numbers failed to boost the markets due to concerns about further interest rate hikes by the RBI. The markets ended the day with modest losses near the lows, amid negative market breadth and higher trading volumes. Technically, most indicators are signaling that sellers have the upper hand and further volatility is expected as the markets take cues from global factors and domestic news.

1. Daily Technical Outlook
16th August 2011
Indices Close % Chg. Mirroring the positive set of global market cues, the domestic
BSE SENSEX 16839.63 -1.29 markets witnessed a gap up opening. However, profit taking
S&P CNX NIFTY 5072.95 -1.27 and selling pressure was witnessed at regular intervals.
NIFTY AUG. FUT. 5079.85 -1.13 Better then expected IIP numbers also failed to enthuse the
India VIX 27.02 -7.11
markets on renewed worries of RBI hiking rates again. The
markets drifted lower amidst occasional bouts of short
S&P CNX NIFTY Technical Levels covering. The markets ended the day with modest losses to
Level 1 Level 2 Level 3
close near the lows for the day. The top losers for the day
were Tata Motors, Reliance Capital, Hindalco, IDFC, Tata
Support 4987 4806 4757
Power, TCS, JP Associates, DLF, Wipo and Infosys Tech.
Resistance 5195 5262 5364
Technically, the market breadth remained negative
Volume (Lacs Shares) amidst higher volumes, which is a negative sign for the
12/08/11 11/08/11 % Chg. markets. The global market set of cues are positive. The
BSE 3183 2256 41.09 domestic markets are likely to witness a gap up opening.
NSE 6635 5431 22.18 The Nifty continues to trade below its 200-day SMA.
Total 9818 7687 27.73 Further the 50-day SMA remains placed below the 100-
Source – BSE & NSE day SMA. The Nifty is trading below the February’11
ascending trendline. The -DI line remains placed above
Turnover ( ` Crores)
the 38 level, indicating sellers have an upper hand. The
12/08/11 11/08/11 % Chg.
ADX line is moving higher, while the +DI line is moving
BSE 2691.01 2374.85 13.31 down. The Stochastic, MACD, RSI and KST are placed
NSE 11260.26 10236.09 10.01 below their respective averages. Moreso, the KST and
NSE F&O 123773.58 107841.86 14.77 MACD are placed in the negative territory. These
Total 137724.85 120452.80 14.34 conditions would result in selling pressure at regular
Source – BSE & NSE intervals. However, a few positive formations are taking
Market Breadth (NSE)
place and would help markets move higher. The MACD,
Stochastic, RSI and KST are placed in the over sold
Advances 577
territory on the daily charts. A positive divergence
Declines 870
pattern formation is underway. These conditions would
Same 64 lead to regular bouts of short covering and buying
Total 1511 support leading to relief rally. The market sentiment
A/D Ratio 0.66 : 1 remains negative. The markets will remain volatile. In the
Source – NSE meanwhile the markets would take cues from the global
Moving Averages S&P CNX NIFTY markets, news flow on the progress of monsoon and
50 Day SMA 5475.04
crude prices. The support levels for Nifty are placed at 4987,
◄Negative 4806 and 4757. The Nifty faces resistance at the 5195, 5262,
100 Day SMA 5560.45
5364 and 5500 levels.
200 Day SMA 5661.98 ◄Negative
Intra-day Resistance Intra-day Support
Indices Close Pivot Point R1 R2 R3 S1 S2 S3
BSE SENSEX 16840 16957 17129 17419 17882 16667 16495 16032
S&P CNX NIFTY 5073 5107 5160 5248 5389 5019 4966 4825
NIFTY AUG. FUT. 5080 5104 5157 5233 5362 5028 4975 4846
Sanjay Bhatia (AVP – Technicals), Email Id sanjay@keynotecapitals.net Yahoo Chat Id: keytechnicals@yahoo.in
Keynote Capitals Ltd.
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4 Floor, Balmer Lawrie Bldg., 5, J. N. Heredia Marg, Ballard Estate, Fort, Mumbai, India – 400001. Tel: 3026 6000 / 2269 4322
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2. Short Term Trading Ideas Based On Technical Analysis (5 - 7 Days)
Stop
Initiation Stop Loss Target
Stock Close Action Price Loss * (%) Target (%) Remarks
Allahabad Bank 189.05 Sell Below 187 190.25 1.74 180 3.74
TTML 19.15 Sell Below 19 19.75 3.95 17 10.53
Bata 697.00 Buy Above 700 688.50 1.64 725 3.57
* Stop Losses are to be considered on Closing basis only.
Keynote Capitals Ltd.
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4 Floor, Balmer Lawrie Bldg., 5, J. N. Heredia Marg, Ballard Estate, Fort, Mumbai, India – 400001. Tel: 3026 6000 / 2269 4322
www.keynotecapitals.com

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