BROAD MARKET OUTLOOK & MARKET VIEW FOR THE WEEK 19TH DECEMBER 2011 TO 23RD DECEMBER 2011

AS ALREADY MENTIONED EARLIER SEVERAL TIMES THAT THE INDIAN MARKETS ARE SET UNDER PERFORM IN OCTOBER & DECEMBER 2011, ITS EXACTLY WHAT HAS BEEN HAPPENING, STOCK MARKET IS VOLATILE, WEAK AND FULL OF PESSIMISM & INTEREST. SEVERAL POLITICAL ISSUES, DEFERMENT OF FDI IN MULTI-BRAND RETAIL, DISMAL OCTOBER IIP DATA, DECLINING VALUE OF RUPEE MAKING THE ECB FINANCED PROJECTS COSTLIER AND NO STRONG SIGNS OF COOLING INFLATION IN NEAR TERM HAS MADE THE INVESTORS TURN IN COLD  SENTIMENT. EVEN THOUGH THE DOMESTIC SITUATION REMAINS DAMPENER, THE GLOBAL SITUATION TOO IS VERY VULNERABLE AND UNCERTAIN. THE U.S INDUSTRIAL PRODUCTION DROPPED IN NOVEMBER 2011 FOR THE FIRST TIME IN SEVEN MONTHS. FITCH RATINGS CHANGED FRANCE'S OUTLOOK TO NEGATIVE AND ALSO WARNED SEVERAL OTHER COUNTRIES OF POTENTIAL DOWNGRADES AHEAD. ON THE LIST FOR REVIEW WERE ITALY, SPAIN, IRELAND, CYPRUS, SLOVENIA AND BELGIUM. US STOCKS SLUMPED LAST WEEK AFTER THE FEDERAL RESERVE TOOK NO NEW STEPS TO BOOST GROWTH AT A MEETING ON DECEMBER 13TH, FAILING TO MEET SOME INVESTORS' EXPECTATIONS FOR FURTHER STIMULUS. THIS ALSO RESULTED IN THE FALL IN COMMODITIES AND PRECIOUS METAL PRICES LIKE GOLD AND SILVER.


GOING FORWARD, INDIAN MARKETS ARE LIKELY TO BE VOLATILE AND DIRECTIONLESS AS OPPOSITION DEMANDS RESIGNATION OF Mr. P.CHIDAMBRAM AND Mr. ANNA HAZARE'S STANCE OVER LOKPAL BILL MAY BE CLOSELY WATCHED BY INVESTORS. IN NUTSHELL MARKET MOVEMENT MAY BE MORE DRIVEN BY DOMESTIC NEWS FLOW ESPECIALLY POLITICAL RATHER THAN GLOBAL, IN THIS WEEK. AS RBI HAS CLEARLY INDICATED THAT RATE CUT MAY ONLY HAPPEN IF THE SLOWDOWN ACCELERATES, HENCE THE RATE REVERSAL MAY BE SEEN SOONER THAN EXPECTED. MEANWHILE THE DOLLAR RATE MAY RANGE BETWEEN Rs.50-Rs.54, WHICH SHALL BE GOOD FOR I.T COMPANIES AND EXPORTERS BUT POOR FOR RAW MATERIAL IMPORTING COMPANIES AND THOSE COMPANIES WHO HAVE FINANCED THE PROJECTS THROUGH ECB ROUTE.


FUNDAMENTALLY INDIAN STORY OF GROWTH AND PROSPERITY REMAINS INTACT.HOWEVER WE MAY SEE SOME MORE PAIN GOING FORWARD. TWO MONTHS BACK WHEN I WAS WRITING ABOUT THE POTENTIAL THREATS TO THE MARKET IN DECEMBER, THERE WERE MANY DOUBTS AND COMMENTS BY MANY VIEWERS AND READERS, HOW & WHY COULD MARKETS GO SO MUCH DOWN??? BUT NOW THINGS HAVE BEEN GOING ACCORDINGLY, NOW MARKETS ARE SET GO LOWER FROM HERE. GLOBAL AND DOMESTIC FACTORS ARE WORSENING DAY BY DAY...


SO WHAT YOU SHOULD DO NOW??? STOP WATCHING THE RATES OR START BUYING????


AND THE ANSWER IS SIMPLE..... KEEP ON   STAGGERED BUYING GRADUALLY. HAVE SELECTIVE STOCKS LIST, WHICH I KEEP ON MENTIONING FROM TIME TO TIME. NEXT 200-300 FALL IN NIFTY SHOULD BE USED TO BUY MORE AND MORE.... NIFTY AROUND 4000-4200 ZONE SHALL DEFINITELY SEE STRONG SUPPORT AND BUYING INTEREST. BUY LARGE CAP STOCKS AROUND THESE LEVELS AND WAIT FOR BUYING IN MID-CAPS, AS THEY MAY TAKE MORE LONG TIME TO RECOVER THAN THE LARGE CAPS. BANKING STOCKS LIKE SBI, ICICI, HDFC, ING, KOTAK, AXIS MAY BE THE BEST IN THE SECTOR. BUYING COULD ALSO  BE INITIATED IN SELECT REALITY AND AUTO STOCKS ALSO.


ANY GLOBAL SHOCK, WHICH SEEMS TO COME ANY TIME MAY BE BEST TO BUY THE NIFTY BEES AND LARGE CAP STOCKS. REMEMBER THE LEVELS 4300-4350 SHALL SEE SOME SUPPORT, WHICH MAY BE GOOD TO START FOR SHORT TERM BUYING AND KEEP ON ADDING IF YOU FIND NIFTY FALLING AROUND 4200-4000 ZONE.


TECHNICALLY, DAILY CHART OF NIFTY SHOWS THAT IT HAS BROKEN CRUCIAL  SUPPORT OF 4700 LAST WEEK AND NOW THE STRONG SUPPORT SHALL COME AROUND 4530-4500. IF NIFTY FAILS TO HOLD 4530 THEN 4440 SHOULD BE THE LEVEL OF EXTREME SHORT TERM. ON THE HIGHER SIDE 4920 SHALL BE THE RESISTANCE FOR THE MARKET. IF NIFTY BREAKS 4920 THEN WE MIGHT SEE 5110 ALSO. 


FOR THE WEEK: NO TRADING ZONE FOR NIFTY IS 4590-4725. 
BUY NIFTY CALLS (CE4700 & CE4800) IF NIFTY SUSTAINS ABOVE 4725, WITH STOP-LOSS AT 4590 FOR THE TARGET OF 4815-4920.
BUY NIFTY PUTS(PE4600 & PE4500) IF NIFTY BREAKS BELOW 4590 WITH STOP-LOSS AT 4725 FOR THE TARGET OF 4530-4440.


THE BIAS OF THE MARKET IS WEAK. HENCE YOU SHOULD KEEP EYE ON BREAKDOWN. BUY PUTS, WHEN MARKET BREAKS 4590.......


ASTROLOGICALLY: THE PLANETARY SITUATION CLEARLY INDICATES WEAKNESS IN DECEMBER, AS I HAVE MENTIONED SEVERAL TIMES IN PAST. SATURN AND JUPITER ARE THE REAL PLANETS WHICH MAY BRING FURTHER WEAKNESS IN THE MARKETS. 22ND DECEMBER WILL BE VERY VERY CRUCIAL FOR THE GLOBAL MARKETS. KEEP EYE ON US, EUROPE MARKETS AND ITS REPERCUSSION IN INDIAN MARKETS. HENCE TWO WEAK FROM NOW REMAIN VERY VERY POOR FOR THE GLOBAL MARKETS. WE MAY SEE SHARP CUTS AND MELT DOWN IN ALL..................


TIP: WAITING FOR MORE TIME SHALL DEFINITELY GIVE MUCH BETTER OPPORTUNITY THAN NOW.  


SPECIAL ISSUE/POSTING: THERE WILL BE A VERY WIDE COVERAGE POSTING FOR ENTIRE YEAR 2012 ON JANUARY 1ST 2012 DO VISIT THE BLOG AND GET THE TOP STOCKS OF 2012....................

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Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints.Nothing in this article is, or should be construed as, investment advice.

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