NIFTY OUTLOOK

However, markets have made a new high today and since a lower top remains elusive,

I am tempted to discard the rounding top scenario... this is going on too long now.

Ironically, discarding the rounding top will be good news for bears.

Had the rounding top persisted, symmetry would have required markets to break 4500

after 6 months at the least.

Now the only option left is a fast break of 4500.

I am keeping the bullish scenario on hold,

fully aware that markets can catch me by surprise but yet reasonably confident

that I will be on the right side.

simplest approach, though difficult to believe, is the right approach.

Negative divergence, the "Evening Star" formation for the second time alerting a reversal

And finally the sharp fall below the "Day High Ema"

Now we need to see follow up price action as well as the depth of this correction.

NIFTY GIVE UP ALL THE MORNING GAINS AND CLOSED FLAT.

HIKE IN INFLATION, HDFC POOR NUMBER AND

DOWNGRADE IN METAL, BANKING, AND IT SECTORS ALL

STRIKES THE MARKET.

BULLS CAN BREATH UPTO NIFTY HOLD 5288. BUT TWO CLOSINGS BELOW 5210

WILL CONFIRM THE REVERSAL MINIMUM TARGET OF 5066.

OUT PERFORMERS FOR 15/07/2010

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REALITY AND PHARMA AND MIDCAP ITS.

UNDER PERFORMERS FOR 15/07/2010

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BANKING AND FINANCE AND LARGE CAPS

LAST CLOSE@5386 (-14 POINTS)

LAST HIGH@5450 LOW@5371

5DMA@5364

20DMA@5305

EXPECTED RANGE 5288-5422

The index is at new 52 week highs but the breadth hasn't yet picked up

yesterday the advance decline figure was at 789 to 574

we must also appreciate that Nifty not break yesterday's low and hence is still in the process of

making higher bottom and higher top and also above the neck line

We must wait for tomorrow to decide if the market has made a false breakout and would like to

give up the gains - my feeling is it will bounce back fro the midpoint i.e. 5340.

For tomorrow, as a matter of abundant caution, one should buy Nifty Future once it is above

5405 with stop loss of 5365. On higher side it will find resistance at 5420 - 5440 and 5475

Short position may taken up below 5365 with stop loss of 5405. On lower levels, it will find

support at 5333 and 5320.