The domestic Indian markets witnessed losses on weak global cues and increased selling pressure. The BSE Sensex closed down 0.89% and the Nifty 50 was down 0.82%. Technical indicators suggest the markets may see a gap up opening but upside will be capped due to ongoing negatives. Support levels are at 4987 and resistance is at 5161. The markets will take cues from global trends and upcoming earnings reports.

1. Daily Technical Outlook
24th October 2011
Indices Close % Chg. Mirroring the weak set of global market cues, the domestic
BSE SENSEX 16785.64 -0.89 markets witnessed a flat opening. Selective buying support
S&P CNX NIFTY 5049.95 -0.82 was witnessed as markets remained range bound. The
NIFTY NOV. FUT. 5074.05 -0.56 markets extended losses and slipped below the 5100 level in
India VIX 26.30 2.73
the afternoon trade as selling momentum increased. Though
occasional bouts of short covering were witnessed, buying
S&P CNX NIFTY Technical Levels support remained absent ahead of the weekend. The markets
Level 1 Level 2 Level 3
ended the day with moderate losses to close near the lows
for the day. The top losers for the day were L&T, Bharti Airtel,
Support 4987 4757 4563
Tata Motors, Hindalco, DLF, Tata Steel, Cairn and HUL.
Resistance 5161 5230 5325
Technically, the market breadth remained negative
Volume (Lacs Shares) amidst lower volumes. The global market set of cues are
21/10/11 20/10/11 % Chg. positive. The domestic markets are likely to witness a
BSE 2035 1915 6.27 gap up opening. The Nifty remains placed above its 50-
NSE 4629 4960 -6.68 day SMA, which is a short term positive for the markets.
Total 6664 6875 -3.08 Moreso, the KST and MACD are placed above their
Source – BSE & NSE respective averages and in the positive territory. All
these conditions would lead to buying support at regular
Turnover ( ` Crores)
intervals. However, the prevailing technical negatives
21/10/11 20/10/11 % Chg.
continue to hold good and are likely to cap the upside
BSE 2342.96 2580.57 -9.21 gains. The RSI has slipped below its average and the
NSE 8909.17 9127.84 -2.40 Stochastic is placed below its average. The Nifty
NSE F&O 149566.61 159182.05 -6.04 continues to trade below its 200-day SMA. Further the 50-
Total 160818.74 170890.46 -5.89 day SMA remains placed below the 100-day SMA. All
Source – BSE & NSE these conditions would lead to selling pressure and
Market Breadth (NSE)
profit taking especially at higher levels. The ADX, +DI
line and –DI line are moving sideways, indicating a range
Advances 520
bound trend. The market sentiment remains cautious.
Declines 937
Now, it is important that the Nifty moves and sustains
Same 74 above the 5161 level for it to move higher to test the 5230
Total 1531 level. The 4987 remains an important support level. The
A/D Ratio 0.55 : 1 markets will witness intermediate bouts of volatility
Source – NSE ahead of the derivative segment expiry and RBI’s policy
Moving Averages S&P CNX NIFTY meet on Tuesday. In the meanwhile the markets would
50 Day SMA 4997.20
take cues from the global markets and the earnings
◄Negative season. The support levels for Nifty are placed at 4987,
100 Day SMA 5253.86
4757, 4563 and 4387. The Nifty faces resistance at the 5161,
200 Day SMA 5425.59 ◄Negative
5230 and 5325.
Intra-day Resistance Intra-day Support
Indices Close Pivot Point R1 R2 R3 S1 S2 S3
BSE SENSEX 16786 16857 16961 17137 17417 16681 16577 16297
S&P CNX NIFTY 5050 5070 5101 5152 5235 5018 4987 4904
NIFTY NOV. FUT. 5074 5094 5130 5185 5277 5038 5003 4912
Sanjay Bhatia (AVP – Technicals), Email Id sanjay@keynotecapitals.net Yahoo Chat Id: keytechnicals@yahoo.in
Keynote Capitals Ltd.
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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
Bajaj Holdings 721.15 Sell Below 716.00 733.00 2.37 679 5.17
EKC 63.95 Sell Below 63.50 65.10 2.52 60 5.51
LIC Hsg. Fin. 211.75 Sell Below 209.00 215.00 2.87 195 6.70
* 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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