Stock to trade 16 02 2011

• SBI :- State Bank of India is emerging from a double bottom. Price target may be 2900 approx. consider buying.
• PNB :- TA Turtle upside breakout in PNB 30 mins. Chart. Buy with stop loss below 1070.
• Ranbaxy :- NR7 pattern in Ranbaxy. Buy above 620, Sell below 505.

A strong upmove,

Nifty Watch:- A strong upmove, starting from a low made at 5175 continued with the Nifty touching 5500 befoer retreating a bit. The Index is currently in the 5450 - 5500 resistance area. If and when the Nifty crosses this area, the next resistance comes at 5700 approx. Yesterday's notes are repeated for readers since they remain relevant.

1. After almost seven weeks of declines, the Nifty is oversold, ready for a correction on the upside. The current upmove is probably that correction.
2. Time Correction: The up move may last anywhere between three to four weeks, in terms of time.
3. Price Correction: markets have fallen by 1050 points approx. A correction can see the Nifty rally by 400 to 550 points, giving targets of 5580 to 5730 approx. These are only estimates.

Level:- Looking for support first at 5450 and then at 5380.. The resistance comes at 5500.

Market Outlook 16 02 2011

Markets opened on a flat note and after a small decline of 40 odd points in Nifty in the first two hours it bounced back smartly to cross the crucial resistance level of 5500 in the second half. However, it witnessed profit booking around 5500 levels and finally managed to close at a respectable 5481 levels. From the low of 5177 made on 11th Feb, Nifty has rallied to an intraday high of 5506.50 ( recovery of 329 points). Since the recovery has been too swift and sharp, Nifty might consolidate between 5400 and 5550 levels for some time before takes any fresh directional move. Banking Stocks especially the likes of SBI, ICICI Bank, HDFC Bank and Bank of Baroda were the ones which appreciated the most during this rally. Reliance showed a lot of strength in today’s trading and now if it is able to trade above Rs.950, then it will help the recovery to gain further steam as it has the highest weightage in the Nifty. ADAG stocks were in limelight as Reliance Capital and Reliance Infra saw huge volumes. Capital good sector stocks like BHEL and L&T saw selling right from the morning and both of them lost around 2% each.

We expect Nifty to trade in the 5400-5550 band for some time and stock specific action will be more pronounced during this period. One should be prepared to trade both sides of the market for the next 1-2 trading sessions but till budget we are of the view that the market is likely to have a positive bias.