Nifty update for 14-Jan-2012

As said in the previous post nifty faced a stiff resistance close to 6050 levels and is expected to trade till 5920-5900 in the short term. Bank nifty looks more vulnerable for a correction than nifty and banking stocks would face some more negative surprises in the coming week. It would be a correction ahead of RBI policy and wait for decent corrections to be a buyer. Indus ind bank and HDFC bank would be top picks after the correction. 12300/350 would offer a decent support zone for bank nifty. IT stocks are giving good trading opportunities and it is wise to create long positions in midcap IT names like Polaris and Hexaware for 8-10% return in the short term. On the sell side Bajaj finserv, IRB infra and BATA india are expected to move down below the previous low.It would not be wise to create sell positions in nifty but banknifty and these stocks are offering some decent trades on the sell side. In the hourly chart nifty has completed a 5 wave pattern and it would complete the A-B-C pattern some where close to 5800-5900 in 2013 and expected to retest the previous high of 6350 close to March - April. It is better to be an investor in corrections especially in metal stocks as that is the one sector that is yet to perform. These corrections are good buying opportunities as in the daily chart we are still in the 3rd wave and it cannot be the shortest in any case and thus chances of nifty moving to 6350 would be higher in 2013. 

Stock for an investor.

Rolta - The stock is completing a triangle formation and is expected to break out to 90 zone in the medium term. Buy in small quantities and add more above 70-71 there can be a range bound sessions close to these levels and there is a channel break out above these resistance levels. The stock is getting accumulated in good volumes and this can be a very good positive factor the stock in the long term. It might take some time to breakout above 90-95 zone as it has to form some higher tops ahead of a bull market, but wait patiently for decent returns close 100-150% in a years time. The face value of the stock is Rs.10 and the dividend is Rs.3/ year (as of now).Thus it is worth an investment from the fundamental point of view too as the stock is quoting decent EPS and a rise through out the years.