>EAGLE EYE ON 05/10/09 (SHAREKHAN)

DOJI FORMATION

Markets on Oct 01, 2009: Indecisive close

Today Nifty moved in a very narrow range of 5040-5090 and closed with a Doji candlestick formation, which points towards indecisiveness. Nifty has been trading in an upward parallel channel, where the upper-end is at 5150 and the lower-end is at 4900. It is now important for the index to surpass 5150-level to gain further momentum, however there are quite a lot crucial supports at lower levels. Nifty is also trading above averages, which increases its probability to move upwards. So, till these supports are held we maintain our positive bias.

On the daily chart, Nifty is trading above its 20 daily moving average (DMA) and 40DMA i.e. 4880 and 4719 respectively, which are crucial supports going forward. The momentum indicator (KST) has given negative crossover and is above the zero line. Market breadth was negative with 445 advances and 834 declines on the NSE and 1,163 advances and 1,718 declines on the BSE. On the hourly chart, Nifty is trading above its 20 hourly moving average (HMA) and 40HMA i.e. 5039 and 5011 respectively, which are crucial supports in short term. The momentum indicator (KST) has given positive crossover and trading above the zero line.

Nifty and Sensex closed almost flat. Of the 30 Stocks of the Sensex, Bharti Airtel ( up 4.01%) and Reliance Communications (up 3.25%) were the top gainers while Dr Reddy’s Laboratories ( down 3.63) and Maruti Suzuki India ( down 2.82%) were the top losers.

To see full report: EAGLE EYE 05/10/09