June 27,2008
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NIFTY OUTLOOK - TECHNICAL ANALYSIS
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S&P NSE NIFTY Closes at 4315.85. BSE SENSEX Closes at 14,421.82.

NIFTY had a good session yesterday and the charts signals trend reversal pattern.
Yesterday's chart ensures at least 4365 level in NIFTY. But technical analysis need not always work well in this chaotic market situation. World markets and local sensitive news could wrong the technical patterns. Success rate for technical analysis is weak in the present scenario.

4535, 4470, 4680, 5060, 5305 and 6250 are the major levels to be tested on the upper side, similarly.

4400 to 4435 is the first resistance level to be broken.

People who are averse to risk taking are advised not to venture into this market at least for next 45 days. High volatility would be a dampener to people who trade without discipline.

Long term investors could find opportunity to pick their stocks at bottom levels. NIFTY or Sensex doesn't have any leadership quality or uniqueness. Most of the times they react to the international markets rather than corporate fundamentals.

We reiterate our previous view. NIFTY is likely to test 5060 levels in medium term. So, a systematic investment plan would yield good returns for positional traders. Buy in all dips. Sell them systematically up to 5060.

Buy Ranbaxy in dips. Technical confirmation - Will test Rs.700 + (Medium to Long term view).

An interesting quote:
In the middle of difficulty lies opportunity
-- Albert Einstein

Liberalization of ECB norms and upside revision of FII limits in Bond market - likely to have a positive impact on Indian markets in medium to long term. This is a fundamental perspective. How far will it have an impact in the present scenario is still a secret.

These measures would improve the Forex inflows, which would help rupee to appreciate, naturally encouraging FIIs to put their money in Indian markets. However, it would affect exporters and IT sector in medium to long term. This is a short sighted measure to improve economy and control inflation.

No significant Support levels left.

Resistance levels stay near 4610, 4787, 4982 and 5210.

NIFTY is sure to test 6260 and 6345 levels in 6 to 12 months period. So, there is no need to panic. Advise to Long term investors - Patience should be maintained at least until 6250 is tested.

Note: These views do not have any relevance to NIFTY futures.

Stocks to Watch
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RELIANCE, Infosys and TCS have confirmed targets in their chart patterns.
Medium to Long term technical target
INFOSYS - Rs.2290
TCS - Rs.1160
RELIANCE - Rs.2800 to Rs.3000 level

Satyam 540 target - acheived