Volatile Nifty in coming days, Buy Tata Global and Sell KPIT Cummins - 24th July 2011

Indian Stock Markets have become volatile on the backdrop of decent quarterly results, FII inflows but deteriorating US debt dispute and high inflation and poor monsoons are putting a check on the further rise. This week of expiry though can become exception and we might see some movement on the reverse side.

This week, Nifty, is expected to become volatile and direction seems not clear. The Options Trader can buy both Nifty 5600 Call and 5600 Put if Nifty hovers around 5600-5610 during initial trade on Monday. In case it makes a gap up opening on the up side, Nifty is likely to face resistance at around 5710-5720 and becomes a sell candidate. On the downside, Nifty can go below 5500 if it breaches 5540 on the downside.Last week, Nifty made the anticipated move and rebounded from 5550 to 5625. Both stocks recommendations though, hit their Stop-losses :(

During the current week, one may sell KPIT Cummins at around 196 for stop-loss of 203 and target price of 187. The stock had a good run up during last few quarters but disappointing results on 21st July pushed it down. Though it had again rebounded on friday but likely to face stiff resistance around 197 mark. Also psychological level of 200 will also play on traders' mind. Another technical factor that will play is the major gap between short term trend line and long term trend line, which is likely to narrow down in the coming days.

On the buy side, one may accumulate Tata Global Beverages at around 102 with target price of 113 and Stop Loss of 96. The stock has been trading in a range of 90-105 for last six months and has rebounded strongly from 90 levels twice. Also the stock is making a bullish pattern now and likely to break the current levels to 113-115.Wishing you a great trading week ahead...

Nifty close to short term support zone. Pidilite overbought PGHH Buy -17th July 2011

After a negative last week for the bourses, the benchmark indices are likely to show some support in the current range. Quarterly results so far have shown consistent growth coming in the top line, though the bottom line seems hit by rising Interest and Employment costs.

Technically, Nifty is trading close to the support zone of 5530-5560, where it is likely to show some strength. Front line real estate stocks like DLF, Unitech, Sobha Developers, Parsavnath are showing strength and are likely to boost the index up. FMCG stocks too are showing strength which are good indications for the market.

The short-term traders may go long on Nifty in 5530-5540 range. Nifty is likely to move up to 5610-5630 range where it is likely to face some resistance. One may close the position, if Nifty goes below 5510-5515.

Among the stocks, Pidilite Industries is showing resistance for last few weeks at around the current levels, primarily due to technical reasons. RSI is currently close to over-bought zone for this stock. Also the gap between the short-term support and long-term support is quite wide which indicates that the current run up in short-term is difficult to sustain and hence, it might correct a bit. Traders can open their short positions in this scrip at around 170-172 Rs with Stop-loss of 176 and target price of 166.

Another stock that is currently looking good at the moment is Proctor and Gamble (PGHH). It has broken down its current resistance levels of 2000 and hence, is likely to create a short-term rally in the near future. FMCG sector overall is doing well which provides further fillip to this stock. One may enter into this stock at 2010 with stop-loss at 1980 and target price of 2045.

Wishing you a great investing week!!! We will soon come out with more trading and investment ideas.