Markets on February 10: Support at 40-DEMA

The markets began the day on a positive note amidst positive global cues, but dropped below the previous close post noon on account of profit booking. However, they managed to bounce back during the final hour of trade to end the day on a positive note. Finally, Sensex and Nifty closed with gains of 63 and 14 points respectively. Stocks from mid-cap and small-cap indices ended marginally in the green. On the daily chart, the rally continued after the third consecutive daily close and there is no sign of worry until 40-days exponential moving average (40-DEMA) is breached on a closing basis. On the hourly chart, Nifty has broken the rising channel but until the wall of hourly averages is broken, today’s down move can be witnessed as a small dip in the current up trend. Up trend of daily KST is still intact. Market breadth was marginally in the favour bulls with 651 advances and 523 declines. On hourly chart, momentum indicator KST has given a negative crossover. Our short-term bias is up for the target of 3000 with reversal at 2752. However our mid-term bias is still down for the target of 2450 with reversal pegged at 3111.

Stocks from realty, capital goods and healthcare spaces led the pack of gainers today, while stocks from metal and fast moving consumer goods sectors led the pack of losers. From the 30 stocks of Sensex DLF (up 9%), Bharat Healthy Electricals (up 4%) and Larsen & Toubro (up 3%) led the pack of gainers. On the other hand Reliance Infrastructure (down 3%) and Hindalco Industries (down 2%) led the pack of losers.

(Disclaimer : The above chart shown is for study purpose only and not for trading decision)

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