Todays Sentence

I think most great traders are no different from great athletes, great musicians or great surgeons. It’s the life-long pursuit of mastering the markets. It means working 10, 12, 18 hours a day – Laurence Connors

DERIVATIVE PICK

JP ASSOCIATES ( CASH – Rs.90.30) : The stock has made a smart rebound and we expect the smallupmove to get converted into a bigger upmove. Buying is advised above Rs.90 for a target of Rs.94 and Rs.96.50. Higher target of Rs.99-101 is also possible. A slightly loose stop loss of Rs.85.75 should be kept. Since it is a positional trade, the time frame would be around 10-12 trading sessions.

STOCK WATCH

LIC HOUSING FINANCE ( LICHF)
Present Price – Rs.193.20, Buy Above – Rs.198, Projected Price – Rs.218-224

LICHF is the fourth-largest mortgage finance company in India. It provides loans for homes, construction activities, and corporate housing schemes. Almost 90% of the company’s loans are to retail customers and the balance 10% to large ticket commercial sector companies. On the technical front, once the stock price crosses the level of Rs.198, it will break out of a bullish pattern and the target of the stock works out to Rs.218-224. The 14 day RSI too after a consolidation between 40 and 60 levels is also ready for a breakout from the 60 levels which once happens will strongly support the pattern breakout.

Stock To Trade 17 02 2011

• GMDC :- GMDC Ltd made a NR7 today looking for a big move. Support at 115, Resistance at 124.
• HUL :- HUL is trading in a range since last 14 days today made a narrow range may lead to a big move.
• IDBI :- IDBI Bank made a narrow range today. May lead a big move. Support at 130.

CONSOLIDATION WITH NR7

Nifty Watch:- The Nifty opened at 5484. The Index made a low at 5458 with a 30 point decline, and then moved up to its day high at 5508 and finally closed at 5493 with a gain of 9 points to its open. Today market consolidates between trading ranges of 50 points. It may lead to a big up move tomorrow. Nifty made a narrow range today which shows us that a big move will come soon, maybe tomorrow. This could be up or down.

Trend:- The short term trend is up. Today’s market is in a process of consolidation. The Intermediate trend remains down, with the Nifty trading below its 200 days and 50 days moving average. TA Insync(55-5) has now crossed above the level of -45 and is moving up. This shows us that the up move which started may continue.

Level:- Looking for minor support at 5450 and major support at 5380. Minor resistance comes at 5500 and major comes at 5550. Nifty made a Narrow range today. This could signal a big move tomorrow.