Caution at Higher Levels ….!!!

Planetary Position ::  During the current week Moon would be transiting  from Uttara in Leo  to Visakha  in Libra.
Sun transits in  Visakha and Anuradha     in Scorpio.
Mercury   transits  in  Visakha  constellation  Libra .
Venus transits in   Anuradha in Scorpio.
Mars  transits in   Poorvashadha constellation in Sagittarius .  
Saturn transits in  Scorpio  in Visakha constellation and Cancer Navamsa.
Jupiter transits in  Cancer in Aslesha constellation in    Pisces  navamsa ..

Sun Saturn conjunction on Nov 18 is to be watched for any trend reversal. Nifty is trading above the high of Monthly astro reference range and the stop loss is 8295 (below which it becomes bearish for the month)

Nifty Outlook for Next Week :: (17.11.2014 to 21.11.2014) …  

NIFTY :: 8390 (+53) (Short term Bearishness below 8300….)
After Two weeks’ of smart rally Nifty moved in a small range for the last Two weeks and appears to be consolidation zone for a Breakout / Breakdown. Macro factors were quite positive with better than expected IIP growth and cooling inflation. There is a good case for interest rate cut and market has been moving up in expectation of a rate cut which appears imminent. Stock market is usually ahead of fundamentals and corporate results are yet to catch up with improved fundamentals. Falling crude and commodity prices couple with lower interest cost (rate cut to be announced) would all help improve corporate earnings next year and market appears to have largely factored them in their prices. Despite these positive factors, market appears to be fully priced and stock picking is the only way to perform in the market. Next Big event is Budget and big bang reforms can be expected in the budget.

Nifty is once again above all short term moving averages and  is infact at a new HIGH. However, in view of the over bought position, traders need to be vigilant and high degree of caution with proper risk management is necessary.

20DMA, 50DMA, 100DMA and 200 DMA are placed at about 8130, 8060, 7875 and 7265 respectively and would
act as supports / resistances.

Nifty continues to be above 200 DMA and 50 DMA too is above 200 DMA (Golden Cross) suggesting that the
long term bullish trend is intact.   Nifty is quoting at a PE of about 21.35, which is about 20% above the long term PE multiple.  Hence, further upside (  8500+ is possible  before next Budget). It is a record PE multiple in the recent times signalling  caution.

Strong long term support would be around 7275 level and Medium term support is 7875. Short term support is at 8300 and Nifty would become weak only on a close below 8300.

Technical Levels ::
For the coming week, Nifty spot is expected to face
resistance at 8480,  8575, 8665 and find support at 8300, 8205, 8115.
Minor resistances may be found at 8425, 8450, 8465, 8490  and minor supports at 8355, 8330, 8315, and 8285.

For short term Nifty is bullish and would become bearish only if it closes below 8300 . Further Nifyt has been trading in a narrow range for the last Two weeks and a firm close above 8400 is bullish while a close below 8300 would take it downwards.
Breakout level for the week is 8445 and break down level for the week is 8275.

Advice for Traders ::
Nifty’s uptrend continued for the Fourth week while the movements were very narrow during last weeks. Macro fundamentals are improving with falling crude , metal prices and falling inflation. Market is looking to RBI policy for directional movement. However, in view of the recent smart rise, retracement is most likely before the policy. In view of the narrow movement during the month so far, a directional movement on either side (8550 on the upperside or 8100 on the downside) is likely before the end of the month. Stock specific approach may be followed.


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