Wednesday, November 3, 2010

Trade Plan - November 4, 2010






Gap up opening above 6150 and Nifty remained in this range throughout the day and touched a high of 6182. VWAP @ close is 6196.  Nifty closes above the important hurdle of 6150 and closes @ 6160.

1) There could be a small dip to around 6100-6135 to fill the gap up opening of today. A gap up opening means 6180-6240 levels on the bullish side.
2) Trading range for tomorrow will be 6100-6135-6175-6240. Break of 6100 will mean intra day break down tomorrow. Longs only above 6180 or if support is found at 6120-6135 level on dips.
3) A chart of the index heavy weight Reliance is attached. Reliance monthly chart shows accumulation of the stock over a period of 6 months and the stock has been mainly traded between 950-1100 levels for a long time now. If Nifty has to make new highs, then Reliance is a stock to watch now amongst the index stocks apart from the already fired up banking, auto, and pharma stocks. Will Reliance breakout above 1095 levels towards 1200-1300 during this month with its excellent quarterly results.  Also, the power stocks look  good for up move along with telecom sector stocks like RCom and Bharti after having consolidated to take the index to newer highs.  For this the level of 6135 must be held over the next week consistently on closing basis.  Tomorrow is also the listing of Coal India IPO, which will set the trend for the fireworks on upside on muhurat trading the day after on weekend.  Happy Diwali! Happy trading!

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