1) The domestic Indian markets opened positively, mirroring gains in global markets. Selective buying provided support and the markets traded higher. 2) Volumes remained tepid but the markets showed no signs of weakness and ended the day with solid gains, closing near highs. 3) Technically, market breadth was robust amid higher volumes, a positive sign, but global cues were largely negative and may lead to a gap down open in domestic markets.

1. Daily Technical Outlook
20th October 2011
Indices Close % Chg. Mirroring the largely positive set of global market cues, the
BSE SENSEX 17085.34 2.01 domestic markets witnessed a positive opening. Short
S&P CNX NIFTY 5139.15 2.02 covering along with selective buying support was witnessed
NIFTY OCT. FUT. 5149.40 2.07 as markets traded higher. The markets showed no signs of
India VIX 24.05 -7.14
weakness but volumes recorded remained tepid. The overall
trend remained range bound for the better half of the day.
S&P CNX NIFTY Technical Levels The markets ended the day with handsome gains to close
Level 1 Level 2 Level 3
near the highs for the day. The top gainers for the day were
IDFC, DLF, L&T, Hero Motocorp, Wipro, Sun Pharma, Tata
Support 4987 4757 4563
Motors, Axis Bank, Bharti Airtel and SBI.
Resistance 5161 5230 5325
Technically, the market breadth remained robust amidst
Volume (Lacs Shares) higher volumes, which is a positive sign for the markets.
19/10/11 18/10/11 % Chg. The global market set of cues are largely negative. The
BSE 2186 1791 22.05 domestic markets are likely to witness a gap down
NSE 5434 4522 20.17 opening. The Nifty remains placed above its 50-day SMA,
Total 7620 6313 20.71 which is a short term positive for the markets. Moreso,
Source – BSE & NSE the KST, RSI and MACD are placed above their
respective averages. The KST and MACD are placed in
Turnover ( ` Crores)
the positive territory. All these conditions would lead to
19/10/11 18/10/11 % Chg.
further buying support. However, the few prevailing
BSE 2448.33 2200.43 11.27 technical negatives continue to still hold good and are
NSE 9489.69 8811.61 7.70 likely to cap the upside gains. The Stochastic is placed
NSE F&O 137726.54 122386.39 12.53 below its average. The Nifty continues to trade below its
Total 149664.56 133398.43 12.19 200-day SMA. Further the 50-day SMA remains placed
Source – BSE & NSE below the 100-day SMA. All these conditions would lead
Market Breadth (NSE)
to selling pressure and profit taking especially at higher
levels. The ADX, +DI line and –DI line are moving
Advances 972
sideways, indicating a range bound trend. The market
Declines 467
sentiment remains cautious. Now, it is important that the
Same 95 Nifty moves and sustains above the 5161 level for it to
Total 1534 move higher to test the 5230 level. The 4987 is an
A/D Ratio 2.08 : 1 important support level. The markets will witness
Source – NSE intermediate bouts of volatility ahead of the derivative
Moving Averages S&P CNX NIFTY segment expiry next week. In the meanwhile the markets
50 Day SMA 5000.96
would take cues from the global markets and the
◄Negative earnings season. The support levels for Nifty are placed at
100 Day SMA 5261.94
4987, 4757, 4563, 4387 and 4291. The Nifty faces resistance
200 Day SMA 5436.34 ◄Negative
at the 5161, 5230 and 5325 levels.
Intra-day Resistance Intra-day Support
Indices Close Pivot Point R1 R2 R3 S1 S2 S3
BSE SENSEX 17085 17022 17170 17255 17488 16937 16790 16557
S&P CNX NIFTY 5139 5121 5166 5194 5266 5094 5048 4975
NIFTY OCT. FUT. 5149 5126 5181 5213 5301 5094 5038 4951
Sanjay Bhatia (AVP – Technicals), Email Id sanjay@keynotecapitals.net Yahoo Chat Id: keytechnicals@yahoo.in
Keynote Capitals Ltd.
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4 Floor, Balmer Lawrie Bldg., 5, J. N. Heredia Marg, Ballard Estate, Fort, Mumbai, India – 400001. Tel: 3026 6000 / 2269 4322
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2. Short Term Trading Ideas Based On Technical Analysis (5 - 7 Days)
Stop
Initiation Stop Loss Target
Stock Close Action Price Loss * (%) Target (%) Remarks
Bata 695.90 Buy Above 700 681.50 2.64 741 5.86
GAIL 424.00 Buy Above 429 419.50 2.21 450 4.90
Sun Pharma 484.70 Buy Above 487 468.50 3.80 528 8.42
* Stop Losses are to be considered on Closing basis only.
Keynote Capitals Ltd.
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4 Floor, Balmer Lawrie Bldg., 5, J. N. Heredia Marg, Ballard Estate, Fort, Mumbai, India – 400001. Tel: 3026 6000 / 2269 4322
www.keynotecapitals.com

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