Trading strategy for 21st February 2012

Markets may witness volatility ahead of F&O expiry The market closed the week with firm trend after successive gains for the 7th week in a row but market pundits are of the opinion that it may well see some correction this week on profit taking at higher levels. Persistent buying by the FIIs during the week coupled with better than expected Q3 results of corporates too aided the market sentiment. The market this week may remain cautious in the absence of any trigger from the corporate world as the reporting season is almost over but volatility is not ruled out as the February F&O series ends this Thursday. Meantime, oil stocks may remain in the focus this week in view of EGOM meeting on changes in the gas allocation policy after reportedly sharp drop in output from KG-D6 block. Readers are advised to remain cautious with stock specific approach.
NIFTY FUTURE (Last close 5589.60)

The counter closed the week gaining a whopping 191 points over its previous close amid high volatility and intra week swing of more than 6%. The counter this week may remain in the range of 5496-5663, break above it may move further up to 5691/5714 or else break below it may slide to 5471/5433. For today’s trading the counter to retain its strength needs to trade and remain above 5613.75 where by it may move up to 5633/5655. Strong support for the counter exists at 5565.25 which if breached decisively with volumes then it may slide to 5543/5525.


The stock after consolidating closed the week gaining over one per-cent with high volumes indicating accumulation of the stock at current rates. The stock remains positive on charts and may move up to 209/212 once it trades and remains above 207.25. Strong support for the stock exists at 204.25.BF UTILITY FUTURE (Last close 445.00)

The stock after sharp run up since the beginning of last month appears to be witnessing profit taking at higher levels as is evident on charts. The stock closed on last Friday with marginal loss with moderate volumes indicating profit booking. The stock may further slide to 437/432 once it trades and remains below 442.25. Strong resistance for the stock exists at 449.75.

DEAR READERS,

• PLEASE WATCH THE MARKET TREND AND USE YOUR
  OWN DISCRETION BEFORE TAKING A TRADE.
  Protect profits with trailing stops and cut losses fast.
  Avoid adding contracts in loss making trades

Disclosures: At the time of writing this article, author, his clients & dependent family members may have positions in the stocks mentioned above. The author, his firm, his clients or any of his dependent family members may make purchases or sale of the securities mentioned in website. Author may have positions in above stocks so have vested interest obviously in their going up or down as the case may be.

Disclaimer : Investing in any equity is risky. Our recommendations are based on reliable & authenticated sources believed to be true & correct, and also is technical analysis based on & conceived from charts. Investors should take their own decisions. We assume no responsibility for any transactions undertaken by them. The author won’t be liable or responsible for any legal or financial losses made by anybody.