The Professional Ticker Reader

These are stocks that we expect to out-perform the markets. Cash and derivative strategies are advised thereon. Please stay online to enable loading of graphics from our servers. Please also read the trading tips section at the end of the newsletter.

ACC - this cement major has been a frequent feature in this newsletter and has appreciated in line with our expectations. The scrip is currently at it's highest closing in 11 years and that is a sign of strength. The relative strength of the scrip is high and the oscillators show underlying strength. Upon closing above the 300 levels, the scrip will enter a low / zero resistance zone. We recommend a buy.

Bajaj Auto - This 2 wheeler major was recommended in the previous week and has appreciated as per our expectations. The stock is fast emerging to be the clear leader in the segment as the relative strength study indicates. The scrip has broken out of a congestion level and a confirmatory signal would be a close above the 1080 levels with higher volumes. The oscillators are signalling an underlying strength and we recommend a buy.

Dr Reddy - This is another scrip that has been recommended frequently in the last 4 weeks and has performed in line with expectations. The initial entry was at 774 and has been profitable. The scrip makes a classic rounding bottom formation and the oscillators and the traded volumes are rising in tandem. We re-affirm our target of 845 - 850 in the short / medium term.

Grasim - This scrip has been undergoing consolidation and cooling off for a few months after a spectacular run up last year. Technical traders may note that the scrip has never violated the 52 week SMA on a closing basis and that is a sign of strength. A confirmatory close above the 1210 levels will be a signal of a breakout. We recommend a buy.

Mah & Mah - this scrip was recommended last week and has performed well as a 5 % appreciation has been seen on the counter last week. Technical traders may note that the scrip has closed at it's highest ever levels ( though intraday levels have been higher at 535 ) and that is a sign of strength. The scrip shows strength on the oscillators which are rallying in a saucer formation and the relative strength of this counter is high. We recommend a buy. Once the 535 levels are surpassed, this stock enters a new trading zone.

Ranbaxy - this scrip has been a strong buy from us a month ago and has tested the patience of many a trader. The breakout from a downward channel ( confirmed as a flag formation ) has been the prime reason for a buy recommendation. The recommended profit taking level was 1200 - 1225 and we re-affirm that level as the scrip has signalled a breakout to a lifetime high. The scrip enters a new trading zone where no previous resistance exists and should see faster appreciation to our projected levels.

Reliance Inds - This scrip has been generating excitement for the wrong reasons and attempts to surge higher to it's original status of a market mover. Technical traders may note that the stock has closed at the channel top and any closing above this channel will be a buy for higher risk players. Traded volumes should be monitored on the upmove and a breakout with volumes above 80 lac shares is desirable for a buy signal.

TCS - this scrip was recommended by us at 975 with a target of 1250, which was successfully achieved. The scrip is a strong market out-performer and shows tremendous strength on the price chart which shows a rising tops and bottoms formation. Technical traders will note that the scrip has never closed below the 30 day SMA which is a good immediate support. Buy on major declines to that support with a few weeks perspective.

Tisco - This steel major is showing signs of strength as the closing is at the lifetime highs on the weekly charts and that is a sign of strength. The scrip has managed to close above the congestion levels and may see some profit taking in the short term. However, declines should be utilised to enter long with a short / medium term perspective. Technical traders may note that the 300 levels are a very crucial floor below which the scrip must not go in the coming weeks.

Tata Tea - this scrip was recommended in the previous week above a breakout above the 450 levels and has performed well as a 5 % appreciation has been seen on the counter. The stock is in a higher tops and bottoms formation and we expect a price target of 485 to be a possibility in the short / medium term. A hold / buy on declines is recommended.

BSE Sensex - the Sensex has indicated a clear breakout from the channel and has entered a new trading zone. Though the absolute short term outlook is that of possible profit taking at higher levels, we feel the 6500 levels maybe tested in the short term. On the lower side, expect support at the 6180 levels.

Your call of action - Since the Sensex futures are not very liquid, we suggest trading the Nifty 50 instead.

Nifty 50 - The Nifty is yet to breakout above it's all time high of 2015 and that is a conclusive sign of the next leg of the upmove, which can take the Nifty to the 2035 - 2040 levels. On the lower side, we expect support at the 1958 levels in the coming week.

Your call of action - Buy the Nifty December futures only above the 2004 levels and hold with a stop loss at the 1994 mark. Book part profits at the 2015 levels and sell out completely at the 2024 levels.

CNX IT - this technology index is showing signs of a corrective fall and may test the 2875 levels, which should not be violated in the coming week. Technical traders may note that the index has never violated the 30 day SMA and the same is at the 2790 levels as of now. Upsides are likely to meet resistance at the 3015 levels.

Dow Jones Industrial Average - the Dow has signalled a breakout and managed to close higher than the previous close. The index has managed to breakout above the congestion levels of 10600 but closed below it. Expect resistance at the 10700 levels and support at the 10380 levels.

Dow Jones - Weekly chart

Your call of action - Since Indian investors are not allowed to trade in overseas markets, this is a pure academic study.

ACC I Bajaj Auto I Dr Reddy I Grasim I Mah & Mah I Ranbaxy I Reliance I TCS I Tisco I Tata Tea I BSE Sensex I Nifty I CNX-IT I Dow Jones I Nasdaq I FTSE I Top I Close window I Print page

Nasdaq - The Nasdaq has indicated even higher strength than the Nifty and is poised to test the 2200 levels in the coming week. We expect support at the 2100 levels and hold a bullish view on this counter.

Nasdaq - Weekly chart

Your call of action - Since Indian investors are not allowed to trade in overseas markets, this is a pure academic study.

ACC I Bajaj Auto I Dr Reddy I Grasim I Mah & Mah I Ranbaxy I Reliance I TCS I Tisco I Tata Tea I BSE Sensex I Nifty I CNX-IT I Dow Jones I Nasdaq I FTSE I Top I Close window I Print page

FTSE - the FTSE under-performs the US indices and faces congestion at the 4900 levels, which it must surpass to indicate strength. On the lower side, expect support at the 4650 levels.

FTSE - Weekly chart

Your call of action - Since Indian investors are not allowed to trade in overseas markets, this is a pure academic study.

ACC I Bajaj Auto I Dr Reddy I Grasim I Mah & Mah I Ranbaxy I Reliance I TCS I Tisco I Tata Tea I BSE Sensex I Nifty I CNX-IT I Dow Jones I Nasdaq I FTSE I Top I Close window I Print page

Trading tips for the week

The put / call ratio is climbing and is currently at the 0.29 : 1 levels and the outstanding positions in the derivatives segment have shown a qualitative appreciation. The FII investments are continuing to be very robust.
There is buying at lower levels in stock futures. That indicates an optimistic approach as long positions in individual stocks is being hedged by Nifty shorts.
The index heavy-weights are showing strength again. This in turn will boost the indices and cause a feel good factor. The only worry is that this upbeat sentiment should continue.
Standby for fresh recommendations via SMS on a real - time basis.

The author is a Mumbai based investment consultant and invites feedback at Vijay@BSPLindia.com and ( 022 ) 23438482 / 23400345.

SEBI disclosure :- The author has no positions in any securities mentioned above.