Monday, January 9, 2012

EOD Analysis for 9th January 2012 and Outlook for 10th January 2012

Price volatility and trading opportunities on expected lines but volumes still missing on the bourses; OI in Nifty futures continues to hover around the 23.5 million odd levels and this kind of volume cannot sustain the upsides. For the downside, such volumes buy time for falling but if it continues this way, the cookie will crumble soon. VIX below 27 is temporarily good and is ensuring slow and steady suction of options premium on both sides [Frog in the heating water casserole syndrome......]

Critical levels and outlook remain the same as outlined on Friday. Prices will be very volatile until 12th and then we have 2 more high weightage dates for Jan '12; 17th Jan and 30th Jan [and this will be factored for Feb series obviously]

As far as resilience from the IT pack is concerned, it seems like the market has already priced in the one time gains on forex differential and perhaps consolidating for the next fall. FMCG will be the last to fall. IMHO, one should not take the CNXIT stability as a positive divergence as there is enough historical evidence that BNF leads the rise/fall whilst CNXIT lags by about 3 months.

Euro-Dollar is slowly moving towards 1.25 levels and this may impact BNF. There are 2 more factors [one positive and one negative]

1] A potential dovish stance by RBI - positive factor
2] Deteriorating Credit Growth and surge in NPAs - negative factor

So we need to see how these pan out.
[Some of the points mentioned today on fundamentals are on the basis of a report in Economic Times]

1 comment:

animoitra2011 said...

Naagi bhai regarding high weightage dates.Is it 17th or 27th Jan ?Because 17th Jan obviously falls in Jan series.Regds.