Nifty Market Outlook for 17 oct. 12

Nifty on corrective path
Indian shares closed  flat to higher on Monday after recouping losses in afternoon trade following positiveEuropean cues. Nifty went closer to 5700 level with the index hitting an intraday high of 5,693.70, before closing with gains of 11.20 points at 5,687.25. The much awaited inflation came in at 7.81 percent for the September, which was slightly higher compared to 7.55 percent in August due to hike in diesel price by Rs 5 a  liter in last month. But that was largely in-line with analysts' expectations of 7.73 percent.
        Nifty is expected to face support and resistance between 5,650 and 5,750. Currently, all the technical indicators are in the profit booking phase with RSI at the level of 58. However, MACD which has crossed-over for a bearish indication. The first resistance, for the week ahead, is 5,740 followed by 5,760. In case, Nifty crosses this psychological level, it can further test 5,800 mark on upside. While the first support, for the week ahead, will be at 5,650. A fall below that level could drag Nifty near to 5,600  after hitting fresh 2012 highs, the Indian benchmark indices are expected to take a breather before determining the next direction of the market. FIIs have a huge long position in cash segment but they don’t have in proportionate long positions in stock future, indicating selling could be emerged at higher levels.

                                              3 MONTHS DAILY CHART OF NIFTY


                                            SHORT TERM OUTLOOK ON STOCKS

Stocks with short term Bullish Outlook:
STOCK                                                           S1            S2          R1             R2
HINDALCO                                                 117.9        115.7     121.4        122.7
SIEMENS                                                    687.07      676.03   705.07       712.03

Stocks with short term Bearish Outlook:
STOCK                                                          S1             S2          R1              R2
MARUTI SUZUKI                                     1320.07     1301.88  1370.37    1402.48
INFOSYS                                                   2341.6       2317.6    2400.8       436

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Nifty has formed a “rectangular pattern” suggesting uptrend

Nifty closed above the 5700 level for the second consecutive session on Monday, supported by positive 

European cues and appreciation in Indian rupee. Overall it was a day of consolidation for the market
after it had rallied 1 percent on Friday and 8 percent in September on strong inflow of foreign money.
Nifty is currently trading in range of 50 points in between 5,700-5,750, exhibiting rectangular pattern,
trading within with support at 5,520 and resistance at 5,760.. On upside if level of 5,760 breaches
decisively then we could see rise up to mark of 5,800, on the lower side if level of 5,600 is breaches then
Nifty could retrace up to its mild support of 5,520 mark first and thereafter up to its strong support of
5,500. Technical momentum indicators are currently suggesting uptrend in it. Stochastic is currently
moving in neutral zone, on the brink of entering into overbought territory indicating upside. RSI is
trading in overbought territory at 73 showing positive crossover. Another momentum technical
indicator MACD is trading in positive zone, showing positive divergence, also indicating uptrend

                                   SHORT TERM OUTLOOK ON STOCKS

Stocks with short term Bullish Outlook:

STOCK                                                            S1             S2               R1            R2

J P ASSOCIATES                                          83.47        80.98           87.42       88.88
AMBUJA CEMENT                                      204           198.5          213          216.5

Stocks with short term Bearish Outlook:

STOCK                                                             S1            S2                R1             R2

DLF                                                              225.27       221.53         234.07       239.13
BANK OF BARODA                                   776.68       768.72         798.03       811.42



                                                        NEWS TO WATCH


1.   General Motors India sales down 27% in September
2.   Exports in August down 9.7% YoY; imports fall 5.1%
3.   Maruti Suzuki September sales up 10% YoY at 93,988 units
4.   Fiscal deficit can be reined in at 5.2% of GDP only if subsidies are cut: Kelkar
      Report
5.   Manufacturing PMI steady at 52.8 in September

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