Resistance 5922 & 5974

Dear All,

The finance minister may have to slice at least Rs 20000 crore ($3.2 billion) from government spending to prevent a budget blow-out, which could threaten to send the country's credit rating into "junk" status, two ministry officials said.

If he goes ahead with cuts, the minister would likely focus on areas of discretionary spending but keep programmes, such as food subsidies, in place as state and national elections near, these officials said

Chidambaram, who last year oversaw cuts worth over Rs 1 trillion, is aiming to prevent the budget for the fiscal year to March 2014 from stretching beyond a deficit target of 4.8 per cent of GDP.

"With oil subsidies up by about Rs 30000 crore, the government may have to cut expenditure by around Rs 20000 crore in addition to usual savings of around Rs 30000 crore at the end of the year," said a senior finance ministry official.

Fearing defeat in state elections likely due in November and in national polls due by May next year, government has balked at cutting its hefty oil subsidy bill and recently introduced a costly food subsidy scheme targetted at the rural poor who are the ruling Congress party's core voters

Last month, it deferred a plan to raise diesel prices by close to 10 per cent in one go that could have sharply cut the oil subsidy burden, estimated at over Rs 90000 crore for the current fiscal year - nearly 40 per cent more than budgeted.

The government also introduced subsidised grain to 67 per cent of the 1.21 billion population and has set in motion a substantial revision in salaries and pensions for almost 8 million government workers.

>>> NIFTY <<<

>>> Click the chart to see on full screen <<<

Chinese Non-Manufacturing PMI data, Rupee appreciation helped Nifty to gain strength today. Shut down of US govt and Fall in Dollar helped Rupee to appreciate today also. Now facing resistance at 5922 and 5974. Lets See.

>>> LT <<<

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LT - facing resistance at 830. If unable to cross may see sharp sell off, else need to cross above the upper channel for any upmove. lets See.

>>> BATA INDIA <<<

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Bata India - If unable cross Resistance may see Sell Off. Lets See.

Sell On Rise ?

Dear All,

India manufacturing output falls for second month: HSBC PMI

The PMI for manufacturing, although marginally up from the previous month, stood at 49.6 points in September from 48.5 points in August, indicating moderate contraction in the sector.

A reading above 50 indicates growth and below that depict contraction.

The PMI quarterly average for the second quarter of this year was the lowest since the fourth quarter of 2008.

Employment fell for the first time in around 19 months, mainly due to reduction in new order levels. There was a sharp rise in input costs this month, with all three sectors covered by the survey signalling "stronger rates of cost inflation in the latest month".

Faced with fewer projects, companies reduced their workforce numbers for the first time since February 2012.

According to official data, high imports of gold and oil pushed Current Account Deficit (CAD) to 4.9 per cent of GDP at USD 21.8 billion in the April-June quarter of the current fiscal.

>>> NIFTY <<<

>>> Click the chart to see on full screen <<<

Nifty paused the fall today and shows some pull back due to positive CAD news last evening. Though Shutdown Looms may take a toll on US dollar which may favour Indian INR, I hope US may soon come to a conclusion in congress which may once again impact Rupee. HSBC PMI did not cheer the market.

Though the fall was Puased, important resistance 5784, 5810 and 5835 looks crucial and looks like a Sell on Rise is good for now. Lets See.

>>> BANK NIFTY - As Updated on Last Weekly Review <<<

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>>> HAPPENED AND YET TO <<<

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As said 61.8% giving a good support. Lets wait for more clarity.

>>> ONGC - As given Yesterday <<<

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>>> HAPPENED <<<

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Booked More Profit on ONGC. Met our Target, though looks week and more downside possible.

>>> LT - As given Yesterday <<<

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>>> HAPPENED AND YET TO <<<

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Today LT made a low of 776 which is near to our first target 770. Now as per H&S pattern, expect stock to slide more. Lets See.

Broken Support 5733

Dear All,

A government shutdown: What could it look like?

The federal government moved closer to its first shutdown in 17 years after the Republican-led House voted early Sunday to delay President Barack Obama’s health-care law by one year as part of legislation to keep the government running.

If House Republicans and Senate Democrats cannot agree by the Tuesday-morning deadline, thousands of government employees will be unable to work.

There will be one more round of votes until a government shutdown is certain.

First, Reid and his fellow Democrats in the Senate are likely to vote on Monday afternoon to table the House measure. Aides said they only need 51 votes to block the bills. Democrats control 54 votes in the chamber. This will sideline conservative Republicans in the Senate led by Sen.

"The American people don't want a government shutdown, and they don't want Obamacare," House Republican leaders said in a statement. "We will do our job and send this Bill over, and then it's up to the Senate to pass it and stop a government shutdown."

>>> NIFTY <<<

>>> Click the chart to see on full screen <<<

Nifty Broken Crucial Support 5733. Lets wait for 5637.

>>> CENTURYTEX <<<

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CenturyTex Part Booked. Holding for Target.

>>> LT <<<

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LT booked Part Profit and Holding for Target.

>>> ONGC <<<

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ONGC part profit booked at 266. Stock made a low of 262.65. More downside left

Weekly Review - 30.09.2013

Dear All,

Market on the peak of Volatile last week, since there is no flow of news market lacked direction on either side.

Current account deficit:-

No relief from any front, a Reuters poll of five economists predicting the June quarter current account deficit rising to $23-25 billion, or 4.8-5.4% of the GDP, from $18.1 billion, or 3.6 per cent, in the March quarter, couldn't have come at a worse time. Good enough to hold the bulls. The numbers will be out on Monday.

Raghuram Rajan Warned :-

RBI's new chief Raghuram Rajan had sent a warning signal three years ahead of the 2008 global financial crisis.

Just days back, he seems to have done it again, saying that there is a danger of bubbles forming around the globe due to easy monetary policy implemented to steer the world back into a more robust growth path.

"We seem to be in a situation where we are doomed to inflate bubbles elsewhere," Rajan said.

"We should wonder whether lower and lower interest rates are in fact part of the problem, I say I don't know."

Outlook :-

Markets are likely to remain range bound in the week ahead as investors would adopt wait-and-watch stance ahead of second quarter earnings. Meanwhile, reports suggest that brokerages are likely cut their expectations of growth in earnings per share (EPS) for large companies to mid-single digits on the back of factors including higher interest rates, lower domestic demand and higher cost of imported raw materials.

Markets will closely monitor key economic data such as current account deficit, balance of payments on Monday.

Data for HSBC India Manufacturing Purchasing Manager's Index (PMI) for the month of September is scheduled for release on Tuesday.

Further, the trends in the Indian rupee, crude oil prices and FII activity would also be on the radar of investors.

Auto and cement stocks are likely to be in action after they start releasing their September sales and dispatch numbers.

>>> Nifty Weekly <<<

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Above Weekly Chart suggest an a-b-c-d-e movement and we are on the last leg of 5 wave upmove. Hence we have still more upside left.

>>> Nifty Daily <<<

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As per Daily Chart we need to correct a bit till support 2 before next upmove. Detail analysis on what are the possibilities at Hourly chart.

>>>> Nifty Hourly <<<<<

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Two alternatives - both directions are as per sub wave (iv), we are facing lot of volatile as the a-b-c wave moving with lot of zig-zag. Hope all readers got clear direction as per the above charts.

>>>> Bank Nifty - Weekly <<<<

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Bank Nifty Weekly - stuck in between two lines inside a Pitchfork. Unable to hold 100wma should be noted.

>>> Bank Nifty - Daily <<<

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On Daily front I assumed the ongoing as a 5 wave upmove. Hence should take support at 50% or 61.8% means we should move up soon after the expected correction. Let see

>>> PERFORMANCE <<<

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Expired in No Trade Zone

Dear All,

>>> NIFTY <<<

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Nifty after breaking out of the channel made a very choppy and volatile session for last 2-3 days and expired today inside a No Trade Zone. So lets wait for clarity.

>>> ICICI BANK <<<

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ICICI BANK SL HIT. EXIT WITH LOSS.

Channel Broken on Nifty - 5852 saved on Intraday.

Dear All,

>>> click the chart to see on full screen <<<

Volatile killed. 5852 broken and saved on intraday. Price out of the channel. Price between 50 Hr ma and 100 Hr ma. We hit some Stop loss also. News flow like No Diesel price hike has increased the danger of CAD and news about 7th Pay commission from Central Govt. due to upcoming election has increased the danger of CAD. No doubt rupee may once again fall if all these are done by govt.

So flow of news makes Nifty with lot of extensions. Now for tomorrow 5890,5938 and 5977 act as a resistance. Support as mentioned above on chart. Lets See.

>>> Bank Nifty <<<

>>> click the chart to see on full screen <<<

Bank Nifty falling as abc-x-abc double zig zag. After completing wave x started falling for next abc. Today took support at 9912 which is 50% fib level. Lets see.

>>> ICICI BANK <<<

>>> click the chart to see on full screen <<<

ICICI BANK broken H&S like pattern after completing wave B. Now if stays below 932 should trigger more sell off. Lets see.

Support 5852

Dear All,

Kingfisher Airlines Ltd, which has been grounded for almost a year for want of cash, is in talks with a foreign investor for a potential stake sale, Chairman Vijay Mallya said on Tuesday, without naming any investor.

Mallya has said several times in the past that the company was in talks with potential investors, but the plans have not materialised so far.

Aadhaar's purpose in doubt as SC says it's not mandatory :-

The Supreme Court on Monday dealt a crippling blow to UPA's showpiece Aadhaar scheme by ruling that it can only be issued to those with proven Indian nationality and cannot be mandatory for accessing public services and subsidies.

"In the meanwhile, the Aadhaar card cannot be made mandatory. If anyone applies for Aadhaar card, then you have to verify whether he is a citizen of India or not. These cards cannot be issued to illegal migrants," said a bench of Justices B S Chauhan and S A Bobde as they frowned upon the unique identity numbers being issued without verifying the antecedents of individuals.

The move is a serious setback to the government's plans to transfer cash and subsidies directly into bank accounts of beneficiaries. Meeting the verification criterion laid down by the apex court could prove to be a tough task because only a small part of the population has proof of nationality such as a passport. That the Unique Identification Authority of India, an entity floated by UPA-2 for rolling out the ambitious Aadhaar scheme, is a lean body dependent on vendors only adds to the complication. The UIDAI enjoys no legal backing either.

Narendra Modi staging 'fake encounter' with facts: P Chidambaram:-

Chidambaram Monday said the prime ministerial candidate of opposition Bharatiya Janata Party, Gujarat Chief Minister Narendra Modi, is staging a “fake encounter with facts" while claiming about 8.4 percent growth during Atal Bihari Vajpayee-led government between 1998 and 2004.

Chidambaram also listed the break-up of yearly growth during the Vajyapee government as follows: In the financial year 1998-99, the gross domestic product (GDP) grew by 6.7 percent. Growth accelerated to 7.6 percent in 1999-2000. It slumped to 4.3 percent in 2000-01. For 2001-02, it was 5.5 percent; for 2002-03 it was 4 percent and in 2003-04 it rose to 8.1 percent.

"The two worst years since the turn of the century were 2000-01 (4.3 percent) and 2002-03 (4 percent)... there was a golden period of growth, it was the five-year period under UPA-I," Chidambaram said.

"Can Chidambaram explain why the growth rate today is 4.8 %? When growth rate in this period goes down they have all kinds of explanation on why it has gone down. And then they quote figures from our time to say that they have a better average," BJP leader Yashwant Sinha told reporters here

Sinha alleged that this statistical jugglery is being done by Chidambaram as the UPA government cannot compete on year-to-year basis with the NDA regime and hence is taking out averages.

"They are comparing nine years average with five years average of NDA," Sinha said, adding that when NDA came to power the growth rate was 4.8 % and when the BJP-led coalition relinquished office it was 8.6 %.

"Chidambaram is doing terrorism with facts.... He is only comparing on averages. This is only jugglery of figures," he said.

The former Finance Minister also maintained that while NDA had created 60 million jobs in five years, the UPA government has only provided 2.7 million jobs in nine years.

Sinha said, "Congress has reasons to be scared of Modi, so they don't miss any chance of doing it. The more they will target him the more it will help Modi."

>>> NIFTY <<<

>>> Click the chart to see on full screen <<<

5852 should hold for upmove. Expiry is nearing

Support 5877

Dear All,

The latest RBI policy in which the RBI has raised the Repo rate is clearly an indication that inflation has become the focus of RBI once again. WPI inflation has consistently risen post May 2013 and would likely go up again as effect of currency depreciation and fuel price hikes are accounted for. This would likely hurt the markets as rate cuts will slower than earlier expected.

BofA-ML expects Government to get into the poll-mode as the November 2013 assembly elections come closer. November assembly elections are in a way bipolar contest between the ruling party at the center i.e. the Congress Party and the principal opposition party i.e. the BJP.

These assembly elections will soon be followed by the General elections in April/May 2014. The global investment bank believe that the government is already getting into the poll mode and any major reforms may not happen now.

>>> NIFTY <<<

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5877 or 78.6% Fib level or Channel Support should be broken for fresh selling, else possible bounce once again can't be ruled out. So lets see.

>>> ULTRACEMCO <<<

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Cheers!!!

Weekly Review - 23.09.2013

Dear All,

RBI's new Governor Raghuram Rajan cut the MSF rate to 9.5%, the repo rate was hiked to 7.5%. CRR was left unchanged.

We are anti-inflation' is Rajan's unequivocal message to anyone who had doubts about his Chicago School credentials. And that's good for the economy in the long run.

Many factors may have contributed to the demand pull inflation, but the RBI does not control much of them. It may be the government's wasteful expenditure, or welfare expenditure. Rajan's signal is, if the government continues with its profligacy, it has to pay higher interest rates. Savers, essential for any investment led growth, cannot be punished anymore. We need savers more to fuel investment, than spenders.

"RBI move aims to inject a dose of reality check in the market expectations, and also gives a step ahead of the impending fuel price hike and Fed tapering," said Rajiv Pathak, Research Analyst at Dolat Capital Market.

"The increase in repo rate could have been avoided as industry is already reeling under pressures of high cost of capital and low availability in a tight liquidity situation." - Chandrajit Banerjee, CII Director General

Raghuram Rajan also said on Friday that , "the postponement of tapering is only that, a postponement." "We must create a bullet-proof national balance sheet," Rajan emphasised. Rajan said that while marginal standing facility (MSF) which was reduced by 75 bps, is the effective rate today, over a period of time the economy will return to repo rate being the effective one. "The caliberated withdrawal will help the financial system," he said.

"We have to look at inflation from a 6-12 months perspective. One particular inflation reading does not effect the stance on inflation," Rajan said. "Repo rate should be consistent with inflationary pressures," he added.

>>> NIFTY HOURLY CHART - UPDATED ON 19TH SEP - A DAY BEFORE RBI POLICY <<<

>>> Click the chart to see on full screen <<<

Yes, Alerted and said Nifty should fall. So Every one knows what happened. Raghuram Rajan surprised every one by raising CRR and market crashed. Now whats next ...???

>>> HAPPENED AND YET TO <<<

>>> Click the chart to see on full screen <<<

Yes IHS target almost achieved and logically bulls rally almost over. So I feel market should fall more in next week also. Lets see in detail how nifty moving on 5 mins charts also for getting more clues and ideas.

>>> NIFTY - 5 MINS CHART - AN ALTERNATIVE FOR BULLS <<<

>>> Click the chart to see on full screen <<<

Though IHS target is over, we had some more stream left for bulls on 5 mins chart. The last leg of up move is logically over only when it breaks important supports like 5933 and 5877. If these levels are not broken then assume that the fall is sub wave (iv) on 5th wave upmove. So if you ask me whats the target for upmove in this case, its 6150,6200 and 6280 on the upper side.

So a safe traders must watch the above levels before entering a trade.

>>> BLOCK BUSTER CHARTS OF THE WEEK <<<

>>> RANBAXY <<<

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>>> ULTRATECH - As given on 17th Sep, 2013<<<

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>>> HAPPENED AND YET TO <<<

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>>> BHEL <<<

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>>> PERFORMANCE <<<

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ALL IS NOT WELL - TIME TO STAY CAUTIOUS

Dear All,

With the US Federal Reserve surprising markets with its decision not to start tapering its quantitative easing programme, analysts and economists are of the opinion that the Indian economy has got the much needed chance to repair its weak macros.

With the fears of a capital flight reduced, analysts feel that the government and Reserve Bank of India (RBI) have got the elbow room to implement strong reforms, in order to curtail the twin deficits.

Now that there is some clarity on the road ahead for the tapering plan, all eyes will now be on RBI Governor, Raghuram Rajan when the Reserve Bank of India (RBI) reviews the Monetary Policy on Friday that will provide a first glimpse on the new governor’s approach to tackling the country's growth-inflation dynamics and external vulnerabilities.

Market expectations range from a partial reversal of liquidity-tightening measures at one extreme to a repo rate hike to contain inflation risks at the other.

However, Bernanke’s commentary highlights the fact that US economy is not yet in a position to grow on its own and will need continued dosages of liquidity infusion. A sharp rise in interest rates and few new job creation is an indication that all is not well despite pumping in over $3.7 trillion dollar in the economy. Growth was largely on account of housing sector, but rising interest rates has started affecting this growth. The money train will continue to run for a few more months.

Perhaps that is all the time RBI governor Raghuram Rajan and Finance Minister Chidamabram have to get their act in place. India’s economy continues on its slow pace, all that the Bernanke has done is assured that he will not pull the rug under our feet.

Lets See what RBI suppose to say and act...?

>>> NIFTY <<<

>>> Click the chart to see on full screen <<<

If you are a regular follower of my blog, then definitely you won't surprised by the rally today. Since the day 5800 was save kept writing that nifty should bounce on the upper side. Now Nifty facing resistance like 6195 and 6289. Unable to cross 6195 is a clear signal from bear that its ready to strike the market once again. So Caution advised.

>>> BHEL <<<

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Booked BHEL on first Target with a Profit of Rs.12000/- Cheers!!!