Thursday, December 22, 2011

EOD Analysis for 22nd December 2011 and Outlook for 23rd December 2011

Well the morning session stumped me in terms of volumes rather than the price [for my EW perspective, please see the comment I posted on Raghuji's blog yesterday - nothing more to add to that for now]

OI in the morning was just 23 million and once EU session started upside came in and OI shot up by another 2 million; again a good sign that supply is coming in with the rise but still not enough to sustain. 5 trading sessions away from expiry and still no trace of additional volumes. 30-35 million for sure expected as we move closer to expiry. BNF has been shaping up well that is helping the bourses and similarly defensive counters like HUL and surprisingly INFY still holding fort. [BNF also shaped up as expected with some profit booking and then further short-covering and above the expectations of 8280 odd levels.]

Outlook remains unchanged; For tomorrow supports lie at 4640-4680 [4640 is most critical and if Nifty sustians below 4640 for more than 90 minutes, slippery slope slide can come through and lending credence to this is the Friday factor] Sustaining above 4728 for 90 minutes can take Nifty all the way to 4800-4840 with the Winter Solastice effect - need to be alert on both these sides.

Most critical aspect will be the weekly close and IMHO the Laxman Rekha is 4509; if 4509 is retained on a weekly closing basis, bulls can expect the Santa Rally whilst a close below 4509 simply means short from the highs as then the pending downside will be well below 4450 also.

[CNXIT and FMCG is a bit of a mirage right now and hence one should be careful of initiating fresh longs in these counters. CNXIT normally lags Nifty by about 3 months and hence there is a lot of pain remaining here; FMCG will be the last segment to crashland and this is the time to book profits in FMCG segment - my personal opinion]

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