Weekly Newsletter - Aug 22 2010

The debate now is whether Nifty breaking above the 5500 level is a break out or bull trap. In any case, the indices were getting jittery at higher levels. The FII inflow has kept the momentum going so far. The main indices scaled to 30-week highs on Thursday pushing along banking and realty stocks. But Friday was a different ball game. Global markets reversed direction following a host of reports which pointed towards a slowdown in the US economy.



Derivatives indicators suggest some added volatility in the coming F&O expiry week. Any sharp reversal could trigger a margin call too. On the other hand, bulls will hope some short covering takes the indices to greater heights for the week. A lot also depends on how the global markets behave. Avoid much leverage and ensure that safety is given more priority for the coming week.