JANUARY 21: It was Infosys, ITC, and Reliance Industries which helped the sensex stage a rally on Friday. Thanks to all these counters, the sensex managed to remain above its short-term support of 5530 points. However, on weekly basis, the sensex showed a fall of 44 points.The outlook for the sensex continues to remain positive. Infosys has improved its position, and is likely to remain firm in the near future. It has a good support at Rs 12,600. Hindustan Lever may also remain firm. It has a minor resistance at Rs 2600. A move above this would improve its technical position. On the downside, it has a support at Rs 2520.
The number three counter, Reliance however is very bullish. If one were to go by its technical position, one can expect a sharp rally on this counter. The stock has crossed its medium term resistance levels, and is in a resistance-free area. The stock has a strong support at Rs 310. For short-term traders, long positions are advisable with a stop loss of Rs 317. ITC too has shown signsof recovery. The stock made an attempt to cross its short-term resistance of Rs 845. A move above this level would be extremely positive for the stock.
Ranbaxy failed to show a good move. The correction on this counter seems to be over. But for a major rally, and the last confirmation, the stock needs to cross Rs 1040.
NIIT appears weak. The stock has a support at Rs 2500 whereas the resistance for the stock is at Rs 2700. Larsen and Toubro has a major strong resistance at Rs 475, and long positions are recommended only above this level. State Bank is weak, and likely to show weakness. The stock has a major resistance at Rs 246. Bhel may show recovery but rally is likely only above Rs 230. The stock has good support at Rs 205.
Bajaj enjoys support at Rs 390, and sideway move is likely. MTNL appears weak but has a good support at Rs 275. A fall below this would attract short-sellers.
For the software sector, the outlook is positive. Satyam Computers appears to be the strongest. The rally on thiscounter is likely to continue for some more time. Silverline, SSI, Aptech, Rolta, Digital, and Himachal Futuristic also appear strong.
Other counters where a positive move is likely are: HDFC Bank, Indogulf Corporation, Finolex Cables, Asian Paints, Sterlite, Dabur, Dr.Reddys' Lab, and Amaraja Batteries. However stocks like Arvind, Century, Nestle, LML, Wartsila, and Nocil may remain weak.
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