The domestic stock markets opened flat and remained range bound with lackluster trading. Support from follow-up buying was missing and selling pressure increased toward the end of the day, causing the markets to close near the day's lows. Technically, market breadth was positive but lower volumes and diverging global cues may lead to a negative opening tomorrow. The Nifty is struggling near 4,747 but has sustained above this level.

1. Daily Technical Outlook
6th January 2012
Indices * Close % Chg.
The domestic markets witnessed a flat opening. The over all
BSE SENSEX 15857.08 -0.16
trend remained range bound and listless trading was
S&P CNX NIFTY 4749.95 0.01
witnessed. Follow up buying support remained absent but
NIFTY JAN. FUT. 4758.10 -0.04
selling pressure was witnessed at higher levels. Selling
India VIX 25.91 -1.89 pressure increased in the last hour of trade as markets
S&P CNX NIFTY Technical Levels slipped sharply. The markets ended the day flat to close near
the lows for the day. The top losers for the day were DLF,
Level 1 Level 2 Level 3
GAIL, Reliance, Coal, NTPC, ONGC, Maruti, BPCL, SAIL and
Support 4747 4563 4481
Hindalco. The top gainers for the day were Cairn India, PNB,
Resistance 4987 5037 5161 Bajaj Auto, IDFC, Axis Bank, JP Associates, Ambuja
Moving Averages S&P CNX NIFTY Cements, Hero Motocorp., Tata Power and Kotak Bank.
50 Day SMA 4911.91
◄Negative Technically, the market breadth remained positive amidst
100 Day SMA 4954.56
lower volumes. The global market set of cues are
200 Day SMA 5263.27 ◄Negative divergent. The domestic markets are likely to witness a
Volume (Lacs Shares) * negative opening. The Nifty is struggling around the 4747
level but has managed to sustain above it. However, the
05/01/12 04/01/12 % Chg.
markets once again failed to witness follow up buying
BSE 1883 2657 -29.13
support, shows tentativeness on part of the participants.
NSE 5239 5697 -8.04 The MACD, Stochastic, RSI, and KST are placed above
Total 7122 8354 -14.75 their respective averages. These technical conditions
would help in fueling buying support. However, the
Turnover ( ` Crores) *
prevailing technical negatives continue to hold good and
05/01/12 04/01/12 % Chg. are likely to weigh on market sentiment. The Stochastic
BSE 1948.54 2183.70 -10.77 is placed in the over bought zone and would lead to
NSE 9440.37 9715.83 -2.84 profit taking. The KST and MACD are still placed in the
NSE F&O 70732.78 86385.04 -18.12 negative territory and warn of impending selling
Total 82121.69 98284.57 -16.44 pressure. The Nifty continues to trade below its 50-day
SMA and 200-day SMA. The 50-day SMA remains placed
F&O Contracts Traded (NSE) * below the 100-day SMA. All these conditions would lead
05/01/12 04/01/12 % Chg. to selling pressure especially at higher levels. The ADX, -
Index Fut. 402452 512984 -21.55 DI line and +DI line are moving sideways, indicating a
Stock Fut. 423002 455235 -7.08 range bound trend. The market sentiment remains
Index Opt. 2036818 2561138 -20.47
cautious. Now, it is important that the Nifty witnesses
follow up buying support. Nifty should continue to
Stock Opt. 122346 120581 1.46
sustain above the 4747 level for it to move higher and
Total 2984618 3649938 -14.32
test the 4987 level. In case it fails then increased selling
Market Breadth (NSE) * pressure is likely and Nifty could test the 4563 support
Advances 797
level. In the meanwhile the markets would take cues from
the forthcoming earnings season, which would kick start
Declines 661
from the next week, the global markets and the crude
Same 68
prices. The support levels for Nifty are placed at 4747, 4563,
Total 1526 4481, 4353 and 4003. The Nifty faces resistance at the 4987,
A/D Ratio 1.21 : 1 5037 and 5161 levels.
NOTE - *- Source – BSE & NSE
Sanjay Bhatia (AVP – Technicals), Email Id sanjay@keynotecapitals.net Yahoo Chat Id: keytechnicals@yahoo.in
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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
Axis Bank 870.65 Buy Above 872.00 859.40 1.44 900 3.21
Bata 564.70 Buy Above 567.00 556.50 1.85 590 4.06
Cairn 339.35 Buy Above 342.00 330.00 3.51 368 7.60
* Stop Losses are to be considered strictly on Closing basis.
Intra-day Resistance Intra-day Support
Indices Close Pivot Point R1 R2 R3 S1 S2 S3
BSE SENSEX 15857 15882 15955 16053 16224 15784 15711 15540
S&P CNX NIFTY 4750 4753 4776 4803 4853 4727 4704 4654
NIFTY JAN. FUT. 4758 4763 4787 4815 4867 4735 4712 4660
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