The domestic stock markets opened with gains mirroring positive global cues. Broad buying support was seen as uncertainty over two key issues subsided. While profit taking trimmed some gains, the markets ended the day higher near daily highs. Technically, market breadth was robust but volumes remained low. The report expects a gap up opening but sees volumes staying thin due to holidays. It notes technical indicators signal further buying support and sees the Nifty testing 5,000 if cues remain positive. However, some technical negatives may cap upside and volatility is expected as the index approaches resistance levels.

1. Daily Technical Outlook
30th August 2011
Indices Close % Chg. Mirroring the positive set of global cues, the domestic
BSE SENSEX 16416.33 3.58 markets witnessed a gap up opening. Broad based buying
S&P CNX NIFTY 4919.60 3.62 support was witnessed as uncertainty over the Lokpal Bill and
NIFTY SEP. FUT. 4933.15 3.74 Ben Bernake’s speech got over. However, the volumes
India VIX 26.07 -21.61
recorded remained lackluster. Though, profit taking and
selling pressure was witnessed at higher levels, the markets
S&P CNX NIFTY Technical Levels managed to hold on to the gains. The markets ended the day
Level 1 Level 2 Level 3
with handsome gains to close near the highs for the day. The
top gainers for the day were Rel. Capital, TCS, Rel. Power,
Support 4806 4757 4563
Rel. Comm., HCL Tech., Jindal Steel, JP Associates, Kotak
Resistance 4987 5200 5325
Bank, Tata Steel and Cairn India.
Volume (Lacs Shares) Technically, the market breadth remained robust amidst
29/08/11 26/08/11 % Chg. lower volumes. The global market set of cues are
BSE 1888 2584 -26.93 positive. The domestic markets are likely to witness a
NSE 5478 5941 -7.79 gap up opening; however, volumes are likely to remain
Total 7366 8525 -13.60 lackluster due to festive holidays during this week. The
Source – BSE & NSE Nifty has managed to bounce back above the 4757-4806
resistance band, which is a positive sign and would lead
Turnover ( ` Crores)
to further buying support. The RSI, KST and Stochastic
29/08/11 26/08/11 % Chg.
have moved above their respective averages, which
BSE 1849.88 2375.99 -22.14 would lead to further buying support. The – DI line and
NSE 9418.90 10267.59 -8.27 ADX have started falling but are still placed above the 35
NSE F&O 90130.66 101375.59 -11.09 level, while the DI line is flattening out. The MACD
Total 101399.44 114019.17 -11.07 continues to be placed in the over sold zone along with
Source – BSE & NSE KST, which would lead to further buying support and
Market Breadth (NSE)
short covering. The Nifty is likely to test the
psychologically important 5000 level if the global and
Advances 1270
domestic market cues remain positive. However, a few
Declines 218
technical negatives continue to hold good and would cap
Same 32 the upside gains. The Nifty continues to trade below its
Total 1520 200-day SMA. Further the 50-day SMA remains placed
A/D Ratio 5.83 : 1 below the 100-day SMA. The markets will display
Source – NSE occasional bouts of volatility as it tries to move above
Moving Averages S&P CNX NIFTY the 5000 level. In the meanwhile the markets would take
50 Day SMA 5361.24
cues from the global markets. The support levels for Nifty
◄Negative are placed at 4806, 4757 and 4563. The Nifty faces
100 Day SMA 5478.24
resistance at the 4987, 5200 and 5325 levels.
200 Day SMA 5598.38 ◄Negative
Intra-day Resistance Intra-day Support
Indices Close Pivot Point R1 R2 R3 S1 S2 S3
BSE SENSEX 16416 16316 16563 16709 17102 16169 15922 15529
S&P CNX NIFTY 4920 4887 4967 5015 5143 4839 4758 4630
NIFTY SEP. FUT. 4933 4894 4987 5040 5186 4841 4749 4603
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
ABG Shipyard 375.00 Buy Above 383 371 3.13 408.00 6.53
Bajaj Auto 1566.00 Buy Above 1575 1541 2.16 1650.00 4.76
L&T 1617.00 Buy Above 1625 1582 2.65 1720.00 5.85
TCS 1018.20 Buy Above 1030 998 3.11 1100.00 6.80
Uniphos 139.30 Buy Above 142 136 4.23 155.00 9.15
* 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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