TECHNICAL OUTLOOK, 16 JANUARY

D Sathia Moorthy


January 16, 2009


Nifty (spot) 2836.70



Nifty Intraday trading levels

Today, if Nifty trades below 2785 then it could test 2700 and below this level, it could test 2650. Instead, if it trades above 2785, then it could test 2870.


Nifty Trading Strategy for intraday and positional trading

For intraday, the crucial level is 2785. Trade short below this level and trade long above this level.

Positional traders can initiate shorts if it fails to sustain above 2870 for a target of 2500 with a stop at 2950 and trade long above 2950 for a target of 3050 with a stop at 2900.



Short term Technical View of Nifty


The short term trend is looking weak and it is likely to test 2500 initially and then it could decline towards 2000 and this view holds good as long as Nifty stays below 3250.

The recent rally from the low of 2250 seems to be corrective and it seems it has peaked out at 3250.

The present rally from 2500 seems to be a counter trend rally and it is likely to peak out below the previous top of 3250.





Medium term outlook of Nifty dated on 14 October 2008

The medium term outlook of Nifty would remain bearish if it fails to sustain above 3100. Nifty is likely to bottom out in the medium term at 2000-2200 levels in coming months and if it fails to sustain above this level, then it is likely to decline below 2000 levels.





Long term outlook of Nifty dated on 13 October 2008

The long term outlook of Nifty is looking bearish and it seems that Nifty is likely to bottom out in 6 months to 1 year if the bottom forms around 2000. If the level 2000 is not held, then Nifty is likely to take more than 1 year to bottom out.





Short term trading calls of Stocks for spot market



Reliance (spot)

The level 1220 is crucial for short term. If it sustains above 1220, then it is likely to rally towards 1260.

Instead, if it fails to sustain above 1220 in coming trading sessions, then it is likely to turn weak and it could decline towards 900 initially.

Trading Strategy for Reliance

For intraday, the crucial level is 1160. Trade long above these levels and trade short below these levels.

Positional traders can initiate longs if it moves above 1220 for a target of 1260. Initiate shorts if it fails to sustain above 1220 for a target of 900 initially.



SBI (spot)

The crucial level for the short term for this scrip is 1200. If it fails to sustain above 1200, then it is likely to turn bearish and in the down side it could test 900 in coming trading sessions.

Instead, if it sustains above 1200, then the short term trend would turn bullish and in the upper side it is likely to move towards 1250.


Trading Strategy for SBI

For Intraday, the crucial level is 1175. Trade long above this level and trade short below this level.

Positional traders can initiate shorts if it fails to sustain above 1200 for a target of 900. And initiate longs if it sustains above 1200 for a target of 1250.



Infosys (spot)

The level 1310 is crucial in the short term. If the scrip trades above this level, the short term would turn bullish and in the upper side it could test 1360.

If it fails to sustain above 1310, then the trend would turn bearish and in the downside it is likely to decline towards 1000 initially.


Trading Strategy for Infosys


For intraday, the crucial level is 1265. Trade long above this level and be short below this level.

Positional traders can initiate shorts if it fails to sustain above 1310 for a target of 1000. Initiate longs if it sustains above 1310 for a target of 1360.





Rcom (spot)

The level 195 is crucial for this scrip in the short term. If it sustains above this level, then it is likely to see a rally from these levels towards 225.

Instead, if it fails to sustain above 195, the short term trend would turn bearish and in the downside it is likely to decline towards 140 initially.



Trading Strategy for Rcom

For intraday, the crucial level is 185. Trade long above this level and be short below this level.

Positional traders can initiate shorts if the scrip fails to sustain above 185 for a target of 140. Initiate longs if it sustains above 195 for a target of 225.




TCS (spot)

The crucial level for the scrip in the short term is 535. The trend would remain bearish for this scrip if it sustains below 535 and in the down side, it could test 440 initially.

If the scrip sustains above 535, then the scrip is likely to turn bullish in the short term and in the upper side it could rally towards 560.


Trading Strategy for TCS

For intraday, the crucial level is 525. Trade long above this level and be short below this level.

Positional traders can initiate longs if the level 535 is broken in the upside for a target of 560. Short if it fails to sustain above 535 for a target of 440.


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