Trading recommendations - March 06, 2005

Reliance Inds - this scrip has simply been the star of the previous week and our perseverance on the counter paid off after 3 whipsaws on earlier occassions. The previous recos were dtd Sept 12 2004, Oct 23 & 31 2004, Nov 21 & 27 2004, Dec 05 2004, Jan 09 2005 and Feb 13 2005. Click here to view the previous recommendations. The same was elaborated in special newsletter on Friday Mar 04 2005. The scrip has signalled a confirmed inverted head and shoulder formation and the breakout has been accompanied with volumes above the 10 day average volumes. Being a measuring move, we feel the target of 600 + is valid in a  conducive market and traders who have initiated long positions at the 552 levels can hold on with higher stop losses at the 558 levels and fresh entry is recommended in small lots at the 570 - 575 levels for the aggressive trader. The oscillators are confirming the upmove and the momentum build up is encouraging. 

Your call of action -

• Investors / cash segment players - Hold existing long positions and entry afresh at the 570 mark. Maintain a stop loss at the 558 levels and expect to book profits at the 590 - 600 levels in a conducive market.

• Aggressive F&O traders - Buy the march futures at the 573 - 575 levels and hold with a stop loss at the 564 levels. Expect to book profits at the 585 - 595 levels in the short term in a conducive market scenario. Options players may buy the March 600 calls at Rs 5. Income conscious players may sell the March 540 puts at a suggested premium of Rs 4.50 

• Derivatives contract size - Market lot = 600 shares. F&O margin = approx Rs 57,000 (subject to change daily )

Your feedback is important ! Please click here to let us know your views. Click here to inform a friend about this page on our website.