Weekly Technicals - Sep 27 2009

Despite a positive start to the holiday-shortened week, the Sensex ended with marginal losses owing to selective profit taking. Markets witnessed stock-specific activity because of derivatives expiry-related cues. The Sensex neared the 17,000-mark during the course of the week as the index touched a high of 16,943 on Tuesday. However, after slipping to a low of 16,495, the index finally ended the week with a marginal loss of 48 points at 16,693.

Among the index stocks - Maruti and SBI jumped over 11.5 per cent each to Rs 1,641 and Rs 2,139, respectively. HDFC, Sun Pharma, HDFC Bank, Tata Motors, DLF and Grasim surged 7-9 per cent each. Bharti Airtel and ONGC, however, were down nearly 2 per cent.

The market will continue to remain up as long as the Sensex holds the 16,400 level. A breach of this level could see the index drop towards 14,800. Next week, trading activity may remain low owing to holidays at the start and end of week - Dussehra and Gandhi Jayanti, respectively. Expect the index to move more or less in the range of 16,970-16,400 unless there is any major external influence.

The Nifty regained the 5,000-mark on Tuesday after a gap of 16 months. The index after touching a high of 5,036, slipped to a low of 4,904. It finally settled with a loss of 17 points at 4,959.

The Nifty is currently in the rising channel and may find considerable support around 4,825, which is also its short-term (20-day) daily moving average (DMA). The medium-term (50-day) DMA is at 4,655.

Next week, the index may find support around 4,910-4,890-4,875 and resistance around 5,010-5,025-5,040.

via BS