Nifty: Scrip specific movement

After 5 weeks of smart gain, Nifty lost considerably erasing more than weeks gain following negative global cues. However, correction was overdue and had set in following global cues and poor numbers from majors. While short term trend is disturbed, medium and long term trend is intact and would get disturbed only if Nifty closes below 5700. Hence, investors with medium and long term outlook can buy on decline while short term traders may sell on rise for the week (with 6100 as stop loss) as further fall appears likely particularly in the view of derivative expiry. Further, macro fundamental such as depreciating rupee, political outlook and FII outlook would determine the future course.

Matter of comfort at the current scenario is falling commodity prices including crude and gold and the possibility of lower CAD. However, if rupee depreciates further and political situation gets murkier with third front in the race, a steep fall over medium/long term too cannot be ruled out. However, presently Short term trend is Down (Stop loss 610), Medium and Long term trend is Up (stop loss 5700) for Nifty and the investors/traders should devise their strategies keeping the above levels in mind. Investors may follow SIP route in respect of quality stocks or "Value Investing "principle with higher margin of safety and traders should be ever vigilant tracking short term movements. For the coming week, Nifty spot is expected to face resistance at 6060, 6140, 6220 and find support at 5905, 5830, 5755 Nifty, presently in Bearish, would get out of short term bearishness only on a close above 6100. Advice for Traders: In view of the last week of F&O settlement, scrip specific movements are likely. Further, after a mild pullback up to 6050 level, further fall appears likely. Hence Sell on Rise policy with 6100 as stop loss may be followed.