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B. Krishnakumar

NIFTY (1555.9)

Preferred view: The movement in the index was in line with last week's anticipation. The index ruled firm as expected and moved to the target zone of 1540-1550 that was mentioned last week. The price action in the past few days indicates that the index could seek further highs in the near term. A move to the 1700-1720 range appears likely. Only a close below the crucial support level of 1430 would be a cause of concern as of now.

Comments: After a slide on Monday, the benchmark indices managed to stage a sharp recovery in the remaining four days of the week.

The deluge of improved financial performance from the corporate sector, continuing strength in FII flows and a SEBI report confirming that there was nothing amiss in the quality of FII flows acted as triggers. As a result, the index managed to move past the positive trigger level of 1550.

The formation of a high and a higher low is a healthy development. The 14-day RSI also managed to rebound after dropping to the 52-level, which is considered to be a support level in a bullish market.

Alternative view: Though the resumption of the uptrend is the preferred view, the close below 1460 would be an early indicator of the short-term bearish trend.

A close below 1430 could pave the way for a drop to the 1270-1280 range.

SENSEX (4906.9)

Preferred view: Similar to the Nifty, Sensex too staged a sharp recovery after having dropped by about 104 points on Monday. As observed last week, the index ruled firm and inched closer to the earlier pivot high of 4951.

The near-term trend remains positive. The index appears to be headed towards the near-term price target of 5200-5250.

Comments: A close above 4960 would be an early indicator of a move to the 5200-5250 range. There is no change in the long-term view that the Sensex would move past the historical high of 6151.

This view would be blunted if the index were to close below 4050. While the index appears headed towards higher levels, a drop below 4590 would be a major cause of concern. This would negate the short-term positive outlook for the index.

S&P CNX 500 (1180.4)

Preferred view: The behaviour of this index was in line with other benchmark indices. The near-term outlook appears positive and a move to the 1275-1300 range likely. The long-term target of a rally to the 1350-1400 range remains valid.

Comments: Aided by a sharp growth in financial performance of quite a few companies, the indices managed to get back into the bullish groove.

Except for a handful of companies, a host of top companies have reported a sharp growth in earnings. A few have managed to record a manifold rise in post-tax earnings.

This has reinstated a bullish trend in quite a few stocks including the likes of Bharat Earth Movers, ICICI Bank, Mahindra & Mahindra and ACC.

This confirms the near-term bullish outlook for the index. The long-term trend would remain in force as long as the index stays above 1160.

CNX IT (18550.6)

Preferred view: The index moved in line with last week's expectations. Aided by a sharp recovery in the price of key technology stocks such as Satyam, Infosys and Wipro, the index managed to rule firm during the week.

The near-term outlook appears positive and a move to the 20000-20100 range appears likely. The bullish view would exist as long as the index stays above 17000.

NASDAQ COMP (1932.2)

The movement in the next few days would determine the short-term trend. The index has formed a double-top pattern at the 1957-1966 range on Friday.

Only a conclusive break above 1970 would impart bullishness. On the contrary, a drop below 1890 would push the index to lower levels of 1800-1820.

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