Morning Bells (11 Sept 2012)

Good Morning Friends,

As told y’day that due to microeconomic condition and growing concerns about Govt's inability to push reform investor will choose to book profit at higher levels, mkt was in consolidation mode.

Some of would have also remember my prediction about EU one and half month back when I had told you regarding EU worry was “I clearly see that EU dragon is on his way and how much time it will take I don’t know” once again hammering my mind because EU debt keeps going higher and higher, once again Dragi’s promise has given some breathing space time being but not solution. I am mentioning it here only because I want you to keep it remembers. And why telling you right now because now its time to play cautious, don’t set too high TGs for your longs and book part profit time to time else one good day will be well enough to swallow your all earnings.

Once again, the week is full of thrill and volatility on both domestic as well as on global (EU) front. Today we have IIP No. announcement, keep eye on it.

Also The German constitutional court’s verdict on the legitimacy of the European Stability Mechanism (ESM) will be keenly watched. Market can lose its cheers ECB’s bond-buying plan if the German court delivers an unfavourable verdict.

US Fed QE3 will also be eyed this week.

MARKET OUTLOOK -

Market will remain under pressure (at least first half) as today we can have 2 shock wave which are IIP Nos and The German constitutional court’s verdict on ECB result. Macroeconomic concerns & inability of policy reform are also there and may prompt investors to book profits at higher levels and that’s FII booked profit in index future on their long positions Y’day and can continue with profit booking ahead of uncertainty. In cash segment FIIs bought 6.92bn in cash segment while DIIs sold 3.18bn as per provisional figures released by the NSE.

So right now there is nothing much to say as its action packed week and market can take any direction according to various events lined up this week.

So cautious approach is suggested and book part profit on rallies to safe your investment.

NIFTY –

Now data shows Nifty range 5280-5400-5450 indicating upside seems capped.  If Nifty continue its upward journey it will face resistance at 5386 - 5400 - 5450 while on downside if Nifty goes below 5335 then selling pressure can drag Nifty to 5335-5300 - 5280.

Trend remains buy on dips till 5335 is safe on closing basis.

STOCK OUTLOOK -

Banks – Banks remain in news this week ahead of RBI policy review, Govt.’s action and festive session.

TM- As suggested Y’day TM crossed 246 and attempted to 250 and didn’t success, made high 248.9. It was expected that TM won’t success in very first attempt. Now TM will face resistance on 252 & 255 while intraday support is 244 and longs SL is 239. So it’s a watch, in 250-255 range (if it goes to that range) it will give thought for taking some PUT options, of course after having look of market sentiment. Y’day fresh short created and OI decreased showing profit booking in index future.

OPEN CALLS –

(Now we need to close our open positions slowly-slowly. Liquidity lover can also close their positions)

Apollo Tyre – (bought @94 and @92) hold stock for updated TG 98+ with SL 86.

Cox&Kings (TG 148, SL 121) its below its good support 129, will wait for mkt and then will think to average our buying levels.

FDC (Bought at 88) hold for TG 94+, SL 78

Bank of India (bought 358) TG 375+ SL 352

Today’s MG Mantra –

Don’t make fresh position till IIP Nos. If you are going long then make only Intraday positions as market mood is not decided yet.

Have a Profitable day – MG

Disclaimer – I have shared my view as per my limited knowledge; please use your own skills before making a wise decision.