Morning Bells (8 Nov 12)

Good Morning Friends.

Never change your originality for the sake of other… because in this world no one can play your role better than you… so be yourself and win the world.

So finally day has come for which I had warned and had exited my longs, especially in FNO. EU closed deep RED ahead of Greece worry even US too trading deep RED (at the time of writing this MB), S&P has broken 1400 Mark which itself indicating bad sign for global economy in recent. If you look to my recent 2 post you will find that – first – when Obama win a 50 point rally would be there, if Romney wins a 100 point rally would be there. Secondly if Obama win then market will go for correction which was already due, now seem all prediction come true. So be prepared for a 50+ points fall today.

Well as guessed Obama’s victory was not something that Wall Street will cheer a lot but somehow I see it favourable for India. Well on home ground, as told many times Indian market is performing on its own merit i.e. what PC has done so far and now all eyes on for physical viability or action for that announcement, so to ride further, we need look to parliament and the Govt. So lets see after a correction today market show strength or not. Remember S&P 1394 is a mile stone and if it closes below that would be a thought of worry.

Since the situation of US is also like our country, so there is going to be taxation issues, which will come on the fore, in the next couple of months, therefore, those markets will remain under pressure in terms of participation and any upside.

Logic is simple - Nifty has gone up some approx 7 percent while large caps haven’t gone up that much, yes small caps & mid caps filled their lockers with good gains as they went up approx 50%+, so now it could be turn for large caps in new year as and when we will head towards yearly results.

So I do not foresee any big loss for Indian market yet (unless & until any further political development), so Indian market will recover sooner than others, Yes, ups and downs and pulls and pressures will be part of market. I see it one more good opportunity like slog overs in Cricket i.e. now pitch will support, ball will take swing so all seems favourable, one just need to judge the ball and can hit a big score.

Why I am hopeful about market recovery because commodities will also weak sooner and this is the country which can take benefit from it most then global leaders.

But just a word of caution I wold like to mention here – may be large IT companies may not participate in those strong upmove as biggest buyers will themselves remain under pressure.

Another short term worry is - KG-D6 gas field output dipping sharply and Oil Ministry has proposed to roster supplies to power plants to ensure better availability of the fuel i.e. gas will be supplied to power plants on rotation basis -- plants will get fuel supplies needed for operating the unit at optimal capacity for one month turn-by-turn.

For a mid-term view – since financial markets have suffered over the last four years with the mortgage crisis, the Lehman crisis, Greece, Europe and policy paralysis in India. Now there is a lot of optimism about Europe and America that markets will make new highs.

There are also hopes for fall in commodity prices because equity fell down and commodity enjoys the bull phase so now either the end of the bull market or there could be a correction, and with hope of that foreign buying is coming because we are the country that is going to benefit the most from the fall in commodity prices. Let’s see what happens.

MARKET OUTLOOK –

3 will decide further move, at opening we are going to fall, now further fall will depend on TM, RIL & Bank Nifty. Bank Nifty seems OK but RIL & TM seems falling, let see what in store today.

After this correction we will be again on home ground and reforms may take the centre-stage again with developments on several important bills for which parliamentary approval is needed is expected to be taken up in the winter session.

Market is consolidating since long seems now players looking for some ground reality on reform announcement. So one needs to see physical activity happening on ground for that to pick up

The INDIA VIX on NSE fell down   4.6% and end at 14.51 and F&O PCR is 0.91.

FII DERIVATIVES STATISTICS FOR 7 Nov 2012
	BUY		SELL		OPEN INTEREST AT THE END OF THE DAY		Difference
	No. of contracts	Amt in Crores	No. of contracts	Amt in Crores	No. of contracts	Amt in Crores
INDEX FUTURES	44275	1241.77	47699	1363.80	452297	11488.85	-122.03
INDEX OPTIONS	547211	15746.10	570718	16308.42	1784219	51408.32	-562.32
STOCK FUTURES	40955	1135.57	40688	1080.60	1078325	29732.47	54.97
STOCK OPTIONS	44527	1246.45	44210	1233.93	82461	2339.42	12.52

NIFTY OUTLOOK –

Nifty Derivatives Statics as on 7 Nov 2012 (Key Facts)
Strike	OI	Change in OI	IV	Strike	OI	Change in OI	IV
Longs created				Shorts created
5700-CE	34,65,750	-4,31,750	12.98	5400-PE	51,62,150	-2,18,800	17.1
5800-CE	57,74,500	-11,500	12.36	5500-PE	55,72,750	6,29,600	15.03
5900-CE	72,27,450	1,18,850	12.18	5600-PE	71,66,650	-64,850	13.7
6000-CE	74,98,600	9,23,700	12.16	5700-PE	68,87,300	13,21,050	12.8

Looks like after a long time bears are ready to take the grip. As warned since past 2 days that OI on long side is decreasing and increasing for short side. In fact a day before y’day we have seen huge unwinding in 5700CE was itself indicator that something is going wrong, same has happened y’day, around same contracts approx 4.31 lac unwinding. Huge 13.21 lac contracts added to 5700PE. So overall it was a clear view.

Resistance comes to 5787 - 5815 – 5853 and Supports comes to 5721 - 5683 – 5656 - 5625. Here I would like to mention Nifty has strong support at 5630 & 5580. Buying momentum is likely to accelerate above 5745 levels.

Trend deciding levels are, on downside keep eye on 5625, can lead to 5500-5450, while some buying momentum can be seen above 5725 and can lead to 5800-5830.

Gap Down opening with approx 50 points is confirmed, now it would interesting to see whether market fall further or try to rebound.

STOCK OUTLOOK -

(Stock outlook needs to watch stock movement carefully and then one can bet after having a look, I tried to put related info which can decide stock move either side.)

Tata Motors –

TM’s second quarter consolidated net profit rose lower-than-expected 11 percent YoY at Rs 2,075 Cr., as pressures continued in the domestic business while analysts on average were expecting Tata Motors to report a profit of Rs 2,200 Cr. so it’s going to be down, but do not expect any big fall like April.

OPEN CALLS –

# Please remember when I make special remark with any position then one should need to take care of that else you can make loss instead of profit.

# Be with strict SL and don’t hesitate to book profit if Nifty doesn’t shows strength.

DhanBank - @55 for TG 70 SL 45

Jindal Photo - @145 for TG 160+ SL 130

DB Realty - @102.5 for TG 115+ SL 94 – Booked profit in just 4 days @115.5, 12%+ return, call closed.

Note – Once can visit blog for New Stock Advice & Open Calls at MudraGuru.blogspot.in

View On Public Demand –

With receiving lot of request but you all know I don’t make call until I don’t track stock, so I just expressing SR Levels and small view on blog members demand, but still you need to track records and take my view as my very personal view.

Note – Remember as told market may open lower today and we need to take advantage of that for good level entry into stocks.

IVRCL Infra – CMP 41.6 TG 44.5 SL 38, R 42.5 – 43.3 – 43.9 (Result on 10 Nov) – Call Closed

(Stock may show weakness in opening. Lot of infrastructure stocks have giving signs of life as realty prices are now started moving up a bit, also there’re lot of hopes with single window infra clearance. So don’t make long positin but it’s a momentum play. IVRCL seems good bet for 1-2 sessions. One can make strategy with 2CE v/s 1PE for good profit.)

- Hope you would have made good profit with this strategy as stock reached to our last resistance level and has already told one can bet only for 1-2 sessions. – Call Closed.

Hindalco – CMP 117.7 TG - Not beyond 122 SL NA, R 119 – 120 – 122 S 116 – 114.5 – 113.5

(Result on 6 Nov)

(Result factor is already priced in and do not have potential for a good move right from here, it will strong resistance at 121 & 122, if it crosses 122 then 125-126 is the point from where it may have correction. So I would prefer to wait for right time to go short.)

Dishman Pharma – CMP 98.7 TG seems - 108 SL 91, R 100 – 101.5 – 103 S 97 – 95 – 94

Today’s MG Mantra –

Market may remain volatile for few sessions, its time to play with extra care, one can make big score but could be clean bold too.

Have a Profitable day – MG

Disclaimer –

1. I have shared my view as per my limited knowledge; please use your own skills to make a wise decision before execution of trade.

2. Those that don’t have patience and are not willing to book loss also in cases don’t enter this market.