July 5,07

NIFTY OUTLOOK - TECHNICAL ANALYSIS
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NIFTY closes at 4359.30. Sensex closes at 14880.24.

NIFTY chart pattern is looking good. But signalled indecisiveness yesterday. It has been consistently maintained that all time high would be tested. As per our view all time high were tested in the last two days. It was mentioned in yesterday's post that an intraday high above day before yesterday's high would be tested. It did happen yesterday.

An important development should be noted. For the first time upper band was tested yesterday,in the recent past, although it closed below it. It is a note of caution. NIFTY had a decent correction in the previous instance, when it tested upper band intraday.

Expanding upper band provides further scope for upward momentum.

For intraday traders, profits could be booked around 4410-4420 levels.

An intraday low below 4236.30 and 4302 are inevitable, although the time frame for them to take place is unknown.

NIFTY's immediate support level stays at 4276.75.

Liquidity would be the dictating factor in the days to come. It is consistently mentioned about the possible lows in this page - "possible lows below 4145, 3985 and 3800 are inevitable." As per our view NIFTY has tested 4145. Expect the rest of the lows to be tested. The time frame for it to take place is unpredictable.

Markets likely to face lower liquidity after public offers of DLF, ICICI BANK, etc.,. Since these issues are larger issues they may suck some liquidity out of the market(particularly FII flows), which may affect the further up move in the NIFTY after few weeks.

Upper band -> 4378.60.

Lower band -> 4083.07.

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

Stocks to Watch
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[NO STOCKS]-> As we advised profit booking for many weeks, no buy calls were mentioned here for many posts. We maintain the Status quo.