Technical view by Nooresh

Short covering ! Bottomed out ! Relief Rally watever a bit of green is good :)

Sensex Technical View :
Sensex made a low of 12822 and made a quick recovery to 13700 intra day today . Well as being mentioned 12500-12800 zone is a good support zone and we could see some sort of bottom around that zone . Sensex bounced back from near to those levels. Technically its an engulfing bull candle which is a stronger bounce back sign which is a relief but we need to see lot more sessions to come out with some confirmations. ( 700 + compared to 500-600 - days means engulfing bull in simple terms ) . As said earlier long term investors have to buy staggered closer to 12500-12800 zone which almost came today and its good to buy only on dips then on recovery days and also reduce some qty if they get 15-25 % bounce . It would be good if we continue to test the bottoms made and make a consolidation technically as none of the bounce backs have lasted for more then 2-4 sessions . Watch for stock specific picks in dips.

Crude oil price , govt politics , inflation are the concerns in short term which may take some more time to peak out but long term investors can continue to buy on support levels slowly as markets would generally bottom out before economics does and nobody can find an exact bottom . We again had quite some investment calls today which bounced almost 15 % in the day itself . Also Ifci and idfc were picks given on gupshup messages which moved from 31-32 to 37 and 100 to 110 in the day itself.

Stocks to watchout for :

Unusual value picks :

IDBI at 52-60
IFCI at 27-31

Although the above stock may not be great on operational side of the business but according to earlier reports there are lot of assets and seem good value for very long term investors as these stocks have come of a lot from the highs. NSE stake etc calculations may show good value for these stocks. if people have extensive inputs on above two stocks can share .

Small PSU banks seem to have over corrected and should settle down close to current levels or lil lower . Investors with patience can look to take exposure in them .

GE shipping has support around 300-310 levels . Investors can wait and watch if it holds the levels and if it doesnt 260-270 is a good price to take exposure.

Glaxo pharma and Lupin are sustaining in the mkts . Traders can keep a watch for some momentum in short term .

Suzlon posted day before broke below 215 to 190 as expected . jindal steel dipped a bit but recovered . All Real estate stocks may have bounced back today but are still way lower then some days back . There could be good ones in the sector but not tracking closely ( for trading bounces fine ) with investment view so would avoid taking a call on a sector which is difficult to valuate . Renuka Sugars , Karuturi discussed bounced back strongly today can wait for dips to take exposure.

SMS messages sent to clients :

30-Jun-2008 14:45:56 Sensex if sustains below 13400-134550 zone and gives a close below it can head to 12500-12800 zone also.Investors can do part buying arnd 30 \% in IDFC at 100-104

01-Jul-2008 13:38:17 Tata Chemicals has come to the buying range. Can buy partial in the range of 255-275 slowly for long term investmen.

01-Jul-2008 15:18:19 Sensex has come close to the range of 12500-12800 and investors can now look to start buying slowly from tomorrow and traders keep trailing stops if on short side.

02-Jul-2008 11:51:37 Sensex has made a low near 12800 and traders should avoid going short near this range. Investors can buy stocks suggested and with a long term view. Can average some stocks if in large caps but not realty or infra.

There were some other messages where BOI reco at 170-190 ( did 229 in the day frm 190 ) , IFCI ( 31 did 37 in the day ) , Praj ( 154 did 174 in the day ) all the stocks were for part buying with long term view but gave quick returns of 15 -18 % in the day itself coz of patient timing . Also in yesterdays message was written to wait for 12500-12800 and investors could start buying today which saw a good 900 points pullback from lows to 13700 !


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Article by Nooresh Merani

Nooresh has written 2531 articles.

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