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.

Andhra Bank - this PSU banking major has surged past it's short term resistance levels and closed above it's 30 day SMA, which is a sign of optimism. The double top resistance at 82 levels has been surpassed on a closing basis and the oscillators are signalling a bullishness in the undertone. We recommend a trading buy on the counter.

Bajaj Auto - this 2 wheeler major was recommended by us in our earlier edition and was advocated to touch the 1200 - 1220 mark. The stock has seen a sharp fall instead and has fallen to test it's critical support at the 30 day SMA and a 4 month low. However, the rising tops and bottoms formation remains intact, the long term trendline formed since April 2003 remains intact and unless the scrip falls below the 940 mark, we do not foresee bearishness on the counter. We recommend a buy for the patient investor on major declines.

BHEL - this PSU electricals major has shown signs of a bounceback from it's 0.618 % retracement and completed a critical chart pattern. The oscillators are pointing towards a pullback and supporting a long position on this counter. The 729 levels are also the 30 day SMA which will be a minor hurdle that the scrip must surpass on a closing basis. The critical levels to watch are 755 ( 0.618 % corrective upmove ), 799 ( previous top ) and then the 860 - 880 which is the likely target if the markets are extremely bullish in the medium / long term. We recommend a buy.

Glaxo - this MNC pharma major has been recommended on many an occassion in the past and has been a market out-performer. The scrip has retraced to test it's 52 week SMA and is currently above it's 30 week SMA.The long term charts are maintaining a bullish view and the scrip is a buy on major declines. Technical traders may note the very high relative strength of 356 ( where 100 = base ) as compared to the BSE Sensex.

Grasim - this scrip has been recommended recently as a buy and has been out-performing the markets. Technical traders may note the high relative strength of 218 levels ( 100 = base ) and the rising tops and bottoms formations on the weekly chart below. The oscillators are confirming the bullishness and we recommend a buy on the counter for the patient investor / trader. Above a consistent close over the 1350 levels, expect a breakout and an accelerated upmove.

HDFC Bank - this private sector banking major was recommended by us since it broke out above the 410 levels. The stock has never looked back since then and has achieved our short / medium term target of 540 / 550 which was forecast. We feel the scrip has still room for upward mobility, though the rate of growth maybe slower. Technical traders may note the very high relative strength of 1437 ( where 100 = base ) and the strong rising tops and bottoms formation on the weekly charts. We recommend a buy for the patient investor / trader on declines.

Maruti - this scrip has seen a sharp retracement from it's top of 476 and seen a near text book style elliot support at the 389 levels. We expect the 440 levels to be a trend determinator of great importance as below this level, the scrip is likely to turn weak in the near term. The immediate target for the counter as long as the 440 is not violated, the 470 - 475 mark. If that hurdle is surpassed, we expect a surge to the 520 levels in the medium term in a conducive market. A buy is recommended.

Mastek - this high momentum technology counter is in a bullish groove as the higher bottoms and tops signify. The scrip has closed near it's previous top at the 395 mark and is likely to see an accelerated upmove once a convincing breakout is witnessed. The oscillators are supporting the upmove and we recommend a buy for the higher risk profile traders, in small lots only.

NTPC - this PSU heavy-weight has seen a retracement of 0.618 and started an upmove. The momentum oscillator is pointing towards an upmove and confirms the bullish outlook. The immediate target is 84 / 85 and should the rally continue, the likely target is the 92 mark in a conducive market in the medium term. We recommend a buy for the patient trader.

Ranbaxy - this scrip was recommended recently as a buy at the 1000 levels and has successfully completed it's bullish target. The scrip has a high relative strength of 471 ( 100 = base ) and the long term trend is bullish. The scrip derives good support at the 970 levels which coincide with the channel top. The scrip is currently trading near it's 30 week SMA support and needs to trade consistently above it to remain in an uptrend. This scrip is a must have in the pharma portfolio.

TCS - this scrip has retraced from it's top ( if the starting point of 958 is taken as the base ) and taken support at the 0.382 % levels and confirmed a bullish undertone. The immediate hurdle will be at the 1305 levels and if the same is surpassed with convincingly high volumes, the outlook turns positive. The previous high of 1364 will then be the logical intermediate target and the 1460 as the next possible top. We recommend a buy on the counter for the medium / higher risk profile investor / trader.

Tisco - this steel major in the private sector is a market momentum barometer and has been recommended by us a buy above the 355 levels as per the recent edition. The recommendation has turned out to be highly profitable as the scrip has cleared a short term congestion zone above this level. The scrip has retraced 50 % of it's gains from the base of the rally that started in Oct 2004 at the 278 levels. That makes the outlook for this stock as bullish and the momentum continues to be positive. The immediate target is the 392 and thereafter, the 417 levels. The 360 - 362 levels are forming into a strong short term base for this scrip. We recommend a buy for the higher risk profile traders.

BSE Sensex - The sensex is showing signs of bottoming out and rallying past the 30 day SMA after a deep correction. The momentum oscillators are pointing towards a rally in the offing and the Sensex will face some resistance at the 6485 levels and thereafter at the 6560 levels. The 6245 levels remain the base for the coming week, below which the Sensex should not fall if the uptrend is to be maintained.

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

Nifty 50 - the Nifty too has bottomed out at the 1900 levels and is likely to rally higher on short covering and bull support. The immediate upsides are likely at the 2020 - 2025 levels and should this level be surpassed, we expect the next target to be at the 2062 levels. The momentum oscillators are pointing towards a bullishness and we recommend a buy on the Nifty for the short term players in small / medium lots.

Your call of action - Buy the Nifty February futures at the 2000 - 2002 levels and hold with a stop loss at the 1988 levels. Expect to book profits at the 2020 levels partially and 2045 levels completely.

CNX IT - The IT index has shown a bounceback from the 30 week SMA and is at the threshold of the 13 week SMA crossover. Should the index cross the 2840 levels, a further 2 % appreciation cannot be ruled out. A buy is recommended in small lots.

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

Dow Jones Industrial Average - The Dow Jones has managed to reverse the fortnights losing streak and closed above the previous weeks close. The index is at the threshold of the 30 & 52 week SMA support and the 10320 levels are crucial for the markets to watch in the coming week. The upsides are likely to face resistance at the 10550 mark.

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

Andhra Bank I Bajaj Auto I Bhel I Glaxo I Grasim I HDFC Bank I Maruti I Mastek I NTPC I RanbaxyI TCS I Tisco 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 exhibited similar chart patterns as the Dow Jones and the support floor is at the 1985 mark which should not be violated or the outlook become weak. The upsides are likely to be capped at the 2082 levels and some consolidation is expected.

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

FTSE - The FTSE is making better chart patterns as compared to the USA indices and is likely to derive support at the 4755 levels in the near term and the upside will see resistance at the 4885 levels in the coming week.

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

Trading tips for the week

The put / call ratio is climbing and is currently at the 0.30 : 1 levels and the outstanding positions in the derivatives segment have shown a quantitative deterioration. That is a routine development after expiry. The FII investments are turning positive after a fortnight.
There is buying at lower levels in stock futures. That indicates a positive 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.
Trades must be executed in small volumes due to the higher volatility expected. Trade fewer counters and conserve cash for future opportunities.
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.