Nifty upside capped at 2830: Nirmal Bang

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Nifty upside capped at 2830: Nirmal Bang

Posted on: March 5th, 2009 and is filed under Brokerage Recommendations.

According to Nirmal Bang’s report, if spot nifty maintains above 2,660-2,680, then we could witness some huge sortcovering in the market and particularly in banking space as the index is highly oversold. But this rally will be a short-term relief rally as the upside is capture to the extent of 2,830.

Nirmal Bang’s report:

The outlook is pessimistic as heavy selling by the FIIs in the frontline stocks is indicating a negative sentiment in the near future. The markets are expected to fall further in the near future as the participation is reducing and the volatility increased as huge delivery based selling by the FIIs is happening.

On the technical front the RSI is not yet in the oversold region and indicates further downside in coming days. The nifty has broken the lower point of 2,660 and is still struggling to surpass that level. The discount of Nifty March futures has trimmed down to 10 points from yesterday’s 35 points indicating that some short covering has indeed happened.

The Nifty is still trading below the lowerend trend line of 2,710 which indeed is a concern of further breakdown.

If spot nifty maintains above 2,660-2,680, then we could witness some huge sortcovering in the market and particularly in banking space as the index is highly oversold. But this rally will be a short-term relief rally as the upside is capture to the extent of 2,830. A very strong sustain move above this can take nifty to 2,980. And for the immediate near term 2,540 should be strict stoploss as below this level the fall could be very extreme.

Stock View: BHEL (1333) – Downtrend likely below 1315. Huge delivery based selling witnessed today as the volumes were very high. The RSI has given a fresh sell signal. The chances are that the stock could test 1190 in coming days.

source: moneycontrol

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