Market outlook for the week 1-5February

As we said last Nifty fut crasheddddddd down from 5030 to 4757 levels and on downside it respected the support level of 4730 and reverted back to give a sharp bounce back, making all shorters sit in huge loss. On friday it was a volatile day for the market that closed in the positive post the RBI credit policy. The market got support from banking, realty and capital goods stocks. It was another weak and volatile week for our market that ended with a mild recovery on Friday. Nifty is likely to stay ranged and will labour to cross any resistance. This week's figures were:

• Sensex and Nifty down 3%.
• BSE Midcap index was down 3.6%
• BSE Smallcap index down 5%
• BSE Metal index was down 8%
• BSE Realty index down 6.6%
• BSE Auto index down 6%
• BSE IT index was down 4.5%
• BSE Bankex index down 1.8%.
  

For the week starting from 1February, Nifty fut will face major resistance at 4980, (with intermediate resistance at 4935 level), If nifty fut manages to sustain and close above this level then we can see bulls charging up once again and taking up the markets to higher levels of 5048-5076-5128. For markets to attempt for a fresh uprise, Nifty fut must close above the level of 4980 consecutively. But looking at the current scenario, traders must not leverage positions at higher levels, as the higher levels will face stiff selling pressure and that can make bears drag down the market. On lower side the bear action will start once agin if the support level of 4830 is breached and sustained. If this happens then Bears will come in action again and will try to take charge over bulls by dragging down the markets to 4776-4730-4665 levels. However, traders must keep booking profits on all their short/long trades time to time, without getting greedy, as the markets will be highly volatile. In come days we can see some sharp oneside movement in markets, so stay hedged with all your positions.

We recommend traders to keep booking profits at every rise, as markets are facing selling pressure each time it attempts to inch higher. So, traders must buy on every dip till Nifty fut is trading abv 4730 level & long positions must be exited at every rise , to conserve the profits. Nifty fut range 4730-4980, must be watched very carefully before executing any fresh trade. Breakout on higher side with high volumes can unexpectedly change the current scenario in favour of bulls. Traders must be stock specific this week, rather than going for the market move because market movement can be dicy & ambiguous this week. Small caps and few mid caps can perform well in coming days. Sentmental trading must be avoided, and traders must follow the levels to trade in the markets.

Nifty Levels

• Resistance - 4935-4980-5048-5076-5128
• Support - 4830-4776-4730-4665-4545

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Stocks for the week

• Kwality Dairy
• Educomp
• Sanwaria Agro
• Cairn
• Bluestar
• BAG Films
• SPIC
• KFA

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Intraday Calls for 1 February

• Gujarat NRE Coke abv 73 tgt-74.2-75.5-78
• SEL MCL abv 92 tgt-94.3-96.8-100+
• Polaris abv 160 tgt-161.5-163-166
• NFL abv 125 tgt-128-132-137
• Also watch Ahmednagar forging, IFGL Refractories, Dr. Reddys, SBI.

For all trades, keep trailing your stoploss once the stock is above the buying price. Dont take delivery of any intraday call. Avoid spike buying.

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