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Technical Outlook for 15th September 2014

 

 

 

 



 

As mentioned yesterday, Nifty gave bearish breakdown from a minor support of 8130 also from the bearish "Rising Channel" pattern having rising support at 8110. This breakdown can take Nifty to 7980-8000 in coming days. After the breakdown, Nifty can pullback to 8140 but these levels should be used for profit booking only. Many midcap stocks have given bullish breakout in EST charts & these stocks are likely to enter fast lane in coming days. Nifty opened with a slightly positive note with a gap of 8-10 points as most of the World markets were mixed & narrow. Some of the markets were slightly positive but most of the markets were closed to the neutral line. Nifty touched an intra day high of 8102 & remained volatile in low range while making lower tops & lower bottoms. It made an intra day low of 8071. Towards the close of the session, Nifty gave bullish breakout from a small "Declining Channel" Pattern to touch an intraday high of 8114 before closing at 8105.50 about 19.80 points above the previous close.

As far as, EST charts are concerned, Nifty, after a non stop rise of more than 640 points since 8th August 2014 has not taken any significant corrective decline. For last 11 trading days it was moving in a bearish "Rising Wedge" pattern with support at 8110. It declined after breaking this support to touch a low of 8051 which incidentally happens to be the neckline support of a "Head & Shoulder" pattern which could otherwise wipe ff 100-125 points in short term. On the bullish side Nifty, which gave bullish breakout is heading for 8250 (in few days) & 8550 (in few weeks).

As far as bar reversal in Daily charts are concerned, stocks like Arvind, Aurobindo Pharma, HDFC Bank, Kotak Bank, Canara Bank, DLF Ltd., Wipro, Lupin Lab, Sriram transport, JSW Steel etc. have given "Upward Bar Reversal" while Motherson Sumi, Infosys, BHEL, SKS Micro, HPCL, Power Finance, Rural Elect., Century Textile, Gateway Distripark, Hind Oil etc have given "Downward Bar Reversal". Stocks like Nelco, JVL Agro Ind., Hmachal Futuristic, Marksans Pharma, Alembic Pharma, Rico Auto, Manali Pero, Shalimar Paints, VIP Ind., Zee Media Corp. have shown  spurt during the day with unusually high volumes.

Sector wise, most of the stocks like Marksans pharma, GTL, Amararaja Battery, VIP Inds., Praj Inds., Cipla, IGL, Amtek Auto, Jyothi Structure, Jindal Saw, PSL, Exide Inds. etc. were among the top gainers of the day, to close in positive territory whereas stocks like HMT, Era Infra, Hanung Toys, Educomp, ITI Ltd., Indian Hotel, On Mobile, Shasun pharma, Eros Media, UB Holdings, Bajaj Hind. etc. a
ttracted profit booking at higher levels & closed in red territory. As far as, A/D  data is concerned it was in favor of bulls in the ratio of 8:7 with 847 advances and 730 declines during the day.

In nutshell, Nifty, which had given bullish breakout from a "Rising Wedge" pattern (technically a bearish pattern) having resistance at 8030 till all set to target 8250 & 8550 in coming days/weeks. However, as far as 5-10 minute charts are concerned Nifty is extremely overbought after a rise of 640 points & there is a possibility that Nifty can take corrective decline towards 8030-7980 in near term. The best strategy is to keep buying technically & fundamentally strong stocks on every corrective decline towards 8030 for short term till Nifty achieves the target of 8250 & 8550.

 

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