Poweryourtrade.com Market Outlook

Rajat K Bose

The movement of the Sensex shows a bearish inside day formation. This formation has earlier led to range-bound activity on the very next day. However, since such an occurrence has been found only twice in the recent past of about one year, we can't say with conviction that this would be the probable market movement for the day.

Going by the international market movements-chances are-we would see an upward swing today at least initially. On the upside, the Sensex would find resistance between 13682 and 13711. This would be the first significant resistance zone. Next, it would gather good upside momentum if it manages to get past 13740. The final hurdle would be a tough 13818 - 13828 supply pressure area. Any major bull charge would be severely resisted by this significant final resistance zone.

On the downside, the Sensex may find support between 13565 and 13526. If it falls further then, chances are, we might see it going down to test even 13450. Any fall below that would make the index look very susceptible to further fall to some where in the region of 13333 to 13295.

Anil Manghnani, Modern Shares & Stock Brokers

The indices have made a fresh break out on Friday and thus should continue to make new highs this week. The Sensex has crossed a major resistance level at 13814 and now is headed towards the next major level of 14017. Once the Sensex crosses and sustains above 14017, it should start another major rally with the immediate targets of 14176 & 14546. The Nifty, on the charts, appears to be stronger than the Sensex and its next targets are placed at 4029-4062-4129.

On the down side, the supports for the Sensex are placed at 13606-13511-13451-13296. For the Nifty the supports are at 3922-3900-3873-3838. One should use any dips to the lower support levels to buy with a trading perspective. One should continue to buy stocks on declines that are making new highs as the upside momentum in these stocks is still very strong.

The Mid-cap Index is also showing some signs of strength and thus could rally up to 5252. However, here one needs to be more selective when picking stocks.

Ashwani Gujral, Techncial Analyst

The Nifty closed at 3997 for the week ended December 1st Nov 2006, up about 1.18% from the previous week. The market is gaining momentum as it makes new highs and participation increases. A more serious correction may start only below 3915. Next target is 4090 and then the mid term target of 4700.

The midcaps are showing strength increasingly on certain days, very select group is attracting consistent money. Realty, construction, media sectors, capital goods and banking are attracting consistent money. In the next week banking, cement and auto sectors are expected to show buoyancy.

Metals and sugar remain weak and people should avoid getting into them before they bottom out.

Overall all dips should be used to buy into the market both at an index level and at the stocks level in the mid cap space. Retail should keep low leverage and try to ride larger moves, as follow through is patchy and higher holding period is required.