NIFTY ACHIEVES 8057 TARGET; TRAIL STOP-LOSS TO 8125

NIFTY ACHIEVES 8057 TARGET; TRAIL STOP-LOSS TO 8125

WORLD MARKETS                             

US indices fell about a fifth of a percent yesterday with Dow failing to reach 20000 mark.

Existing home sales for November hit 5.61 million units, and weekly mortgage applications rose 2.5%.

U.S. Treasuries rose, with the short-term two-year note yielding near 1.2% and the benchmark 10-year note yield around 2.55%. Dollar index eased 0.3%.

US oil fell 1.5% to $52.49 a barrel and Brent fell 1.6% to $54.46 a barrel after Libya said it would boost production in the coming months, and a U.S. Energy Information Administration (EIA) report showed a rise of 2.3 million barrels in U.S. crude stockpiles.

European markets, except a marginally higher DAX, ended with cuts of upto 0.4% amid concerns over the stability of the region's banks. Earlier, Monte dei Paschi di Siena — Italy's third-largest lender — said it could run out of cash in four months, much faster than the originally forecast 11 months.

AT HOME

After holding on to modest gains for better part of the day, benchmark indices nosedived in last hour or so to end lower by a fourth of a percent, extending the losing streak to sixth straight day. Sensex settled at 26242, down 66 points while Nifty lost 21 points to finish at 8061. BSE mid-cap index lost 0.2% while small-cap index managed to gain 0.03%. BSE FMCG index tumbled 1%, becoming top loser among the sectoral indices, followed by 0.75% cut in IT and Teck indices. Realty index climbed 1.5%, becoming top gainer, followed by 0.7% rise in Consumer Durable index.

FIIs net sold stocks and stock futures worth Rs 1178 cr and 300 cr respectively but net bought index futures worth Rs 51 cr. DIIs were net buyers to the tune of Rs 1058 cr.

Rupee appreciated 12 paise to end at 67.91/$.

OUTLOOK

Today morning, Asian markets are trading with modest cuts and SGX Nifty is suggesting about 15 points lower start for our market.

Readers would recall that after Nifty broke 20-DMA support of 8120, we were working with the downside target of 8057, where the immediate previous bottom made on 5th December was placed.

Nifty yesterday touched a low of 8053 before closing at 8061, achieving the target mentioned above and vindicating our view.

Next support on the way down comes around 8000, where the lower band of bollinger on the daily chart is placed below which 7916, the bottom made in November, would be the crucial support to eye.

Immediate resistance on the hourly chart has moved lower to 8125, with the stop-loss of which trading shorts can be held on to.