Feb 28,2007

NIFTY OUTLOOK - TECHNICAL ANALYSIS
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NIFTY close 3893.90. Sensex 13478.83.

Though NIFTY is not out of indecisiveness, crossing over of short term sma and long term sma signals weakness. NIFTY stayed below the lower band continuously for the past 3 days. It is not a good sign. NIFTY got little strength to move up. On budget day expect wild fluctuation in selective sectors.

Immediate resistance for NIFTY stays at 4199.45. Immediate support -> 3817.85.
It provides NIFTY good gap on either side to move up or down. So volatile conditions could prevail in this settlement.

Contrary to other analysts recommendations, we recommend a systemmatic buy in every dip. People who are interested in bottom picking has got the opportunity here to pick stocks at cheaper prices. Even though NIFTY could correct to some extent, it would correct only just 5-10%. Don't wait for NIFTY or stocks to correct, start buying stocks, which are fundamentally good. Just carry little cash to buy if there is a further correction.

NIFTY would test 4137.50(inevitable - sure) in the short to medium term. So start buying and enjoy profits in the shorter to medium time frame. Don't short unnecessarily and risk your money.

NIFTY has signalled a possible close below 3840 & 3801.65(inevitable). But it is difficult to specify the time frame. If NIFTY test this levels in the recent future, it would be a sigh of relief, since it would help NIFTY to bottom, before the next upward rally. Else these levels would be tested after an upward rally.

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

STOCKS TO WATCH
[No stocks]

Technical watch:
This is the right time to buy HINDUSTAN LEVER LTD and ITC. They can be purchased from this level and in further dips, if any. This is a bottom picking technical strategy.