Markets on February 6 :Weekly inside bar

Indian indices started the day on an optimistic note taking cues from global markets. Buying activity was witnessed all through the day, which led the indices rise steadily all along the day to end well in the green. Sensex closed 210 points higher, while Nifty closed 63 points up. Stocks from mid-cap and small-cap indices also posted gains for theday. Today, on the hourly chart, descending triangle saw a positive breakout. But the lack of positive weekly close and an inside bar on the weekly chart indicates that still bulls do not have an upper hand. The daily chart depicts that market is equipoise and the breakout on either side of the range (2752-2881) will decide the next move. An upside breakout has a potential to take Nifty all the way to 3000, while a downside breakout can cause market fall to 2661. Daily KST has started diverging from the signal line. Bulls dominated the market breadth today with 746 advances and 420 declines.

On the hourly chart, the momentum indicator KST has given a positive crossover.Our short-term bias is down for the target of 2661 with reversal at 2885 and the midterm bias is also down for the target of 2450 with treversal pegged at 3111.

Stocks across all the sectors witnessed buying with energy,metals and banking scrips leading the pack of gainers.From the 30 stocks of Sensex Ranbaxy Laboratories (up7%), Grasim Industries (up 7%) and Tata Motors (up 5%)remained in the forefront of gaining stocks. On the otherhand Hindustan Unilever (down 1%) and DLF (down 1% topped the list of losing stocks.

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

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