3rd Oct 2011

Weekly Technical Report Weekly Technical Report Weekly Technical Report Market Consolidates in a Broad Range (3rd to 7th Oct 2011, Nifty CMP: 4943): Market is still in a downtrend and bulls have lot of work (at least a close above 5200 ) to do before we can expect any meaningful change in the present scenario. Spot Nifty ended the week at 4943, up 75 points or 1.55%. Sensex closed at 16,453, up by 92 points or 0.56%. BSE Midcap index was down by 146 points or 2.32% to close at 6129 and BSE Smallcap index was down by 240 points or 3.37% to close at 6881 respectively. Volume was slightly lower as compared to previous week and the market breadth was mostly negative throughout the week, as is evident from the Smallcap index that closed at a new yearly low this week.

Trend Analysis:

The Primary trend still continues to be downward but the market is trying to form a base. 5750 region is the lower end of the trading range and until that range is violated, we will term the Intermediate trend as choppy. On the other hand, Nifty requires a closing above 5200 (The September high is 5170) for any meaningful pull back. We observe that the Commodity prices has peaked up and that is favourable for equities. Now, if the era of rising Interest Rates comes to a halt, that will give the necessary fillip for equities to move higher.

Momentum Indicators:

Not surprisingly, most of the momentum indicators remain negative in their weekly timeframe. MACD on weekly chart is in a sell mode along with RSI treading below 50 and +DI (14.0) treading well below –DI (30.0) making the scenario remain weak..

Moving Averages 50 SMA: 5129 & Falling. 100 SMA: 5317 & Falling

Spot Nifty Important levels for Next Week Support Resistance

1 4900 5025

2 4835 5100

3 4750 5200

200 SMA: 5496 & Falling

NIFTY Derivatives Statistics Spot Nifty ended the week at 4943 whereas Nifty Oct Future ended at 4934 with a discount of 9 points to the underlying. The highest number of call option build up is visible in the Nifty strike 5200 call totaling 4.98 million and the maximum put option build up is visible in the Nifty strike 4700 put totaling 5.69 million.

Trading Strategy for next week: We would consider being buyers on weakness around 4850 with stop loss at 4780 targeting for 4950/5050.

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3rd Oct 2011

Weekly Technical Report Weekly Technical Report Weekly Technical Report Commodity and Currency Still no solution was visible regarding the Greece debt crisis and analysts believe that Greece is in the brink of default which might create deep trouble for the European countries and the ripple effect might be felt across the globe. This kept the global markets jittery and most of them ended the week flat to negative. It is noteworthy that S&P has closed at the lower end of its intrermediate trading range and a break below 1120 is likely to escalate the supply. Back home our market too responded along with the international bourses and ended the week with a minor gain. During the week Spot Nifty tested the support zone of 4750 and honuored the level, at least for the time being. FII’s turned to be heavy sellers for the month of September in cash and future both the segments, whereas DII’s were net buyers. The Q2 result session will be starting to flow from first week of this month, till then our markets are likely to take direction from the local macro factors, global cues and FII stance. In the commodity space, some sort of consolidation were witnessed the previous week in precious metals, base metals and energy complex. Gold has corrected nearly $35/oz or 2.14% during the week to finish at $1626/oz and Silver corrected nearly 3.5% or $1.1/oz to finish the week at $29.98/oz. Light sweet Crude oil too finished the week with a cut of around $1/barrel or 1.33% to end the week at $79.85/barrel. In the currency segment US Dollar index regained its early week loss against the basket of major cross currencies and finished the week at 78.55 up by 0.07%. On the other hand Indian currency appreciated 16 paisa against the US Dollar and finished the week at 49.16.

Technical Outlook for S&P 500 Next Week (3rd to 7th Oct 2011, CMP: 1131 1120: Critical support at 1100 With the fact the market failed to cross above 1200 (upper band of the range) and now trading close to its lower range of 1100, the technical picture hasn’t changed much - it is still rangebound. S&P 500 ended the week at 1131 down marginally by 5.01 points or 0.44%. So, until the trading range of 1100-1205 breaches on closing basis we have no choice other than to stay neutral from intermediate term point of view. From the short term point of view we expect market not to break below 1100, and continuation of this range some time more. Among the momentum indicators MACD is still in Sell mode. RSI(14) showing slight positive divergence and Positive Directional Indicator (+DI) is trading below Negative one (-DI), making the scenario still bearish. We would consider being short term buyers around 1100-1090 with a stop loss below 1040 targeting 1160/1196 in 2-3 week.

Support Resistance

1 1090 1160

2 1040 1196

3 1000 1220

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3rd Oct 2011

Weekly Technical Report Weekly Technical Report Weekly Technical Report Technical Outlook for Spot Gold Next Week (3rd to 7th Oct 2011, CMP: $1623/oz) Selling opportunity on pullback Since February 2011 Gold has rarely traded below its 50DMA. As such a weekly close below its 50DMA (1752), we view it as something more than normal retracement. Spot Gold ended the week at closed at $1623/oz down by $32.04/oz or 1.93%. Any type of pullback we believe is likely to face supply around $1720/oz to $1750/oz (50% Fibonacci retracement and 50DMA coincides around this level) and will be selling opportunity Among the momentum oscillators MACD is in sell mode and RSI (14) just at 50 level breaching of which will trigger a sell and Positive Directional Indicator (+DI) is marginally above the Negative one (-DI) making the scenario still bullish. We would consider being sellers around $1700-20/oz with stop loss above $1780/oz targeting $1630/oz and $1550/oz

Support Resistance

1 1590 1700

2 1550 1750

3 1500 1800

Technical Outlook for WTI Light Sweet Crude Next Week (3rd to 7th Oct 2011, CMP: $79.85/barrel) Downtrend Resumed WTI Crude closed at $79.20/barrel down marginally by $0.65/barrel or 0.811%. With the fact that Crude failed to breakout above the resistance posted at $85.00/barrel, we believe resumption of the another leg down in Crude and failure to hold above $75.00/barrel will confirm the continuation of the ongoing intermediate term down trend. With 50DMA ($87.00/barrel) acting severl time in last one year, which down, we expect Crude not to move any time soon and continuation of the

as resistance again sloping above $87.00 downtrend.

Among the momentum oscillators MACD is in sell mode and RSI (14) still below 50 as such bearish. On the other hand Positive Directional Indicator (+DI) is still below the Negative one (-DI), making the scenario bearish.

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3rd Oct 2011

Weekly Technical Report Weekly Technical Report Weekly Technical Report We would consider being seller around $84.00/barrel with stop loss above $87.30/barrel targeting $78.00/barrel and $75.00/barrel in 2-3 week.

Support Resistance

1 75 84

2 73.3 87

3 70 90

World Indices Security Name CAC DAX TAIWAN WEIGHTED RUSSIAN RTSI INDEX BSE - SENSEX NIKKEI 225 INDEX S&P CNX NIFTY DOW JONES INDL AVG (DJIA) FTSE 100 INDEX HANG SENG INDEX S&P 500 INDEX BRAZIL BOVESPA SHANGHAI COMP

Close 2981.96 5502.02 7225.38 1341.09 16453.76 8700.29 4943.25 10913.4 5128.48 17592.4 1131.42 52324.4 2359.22

POD 171.8499 305.46 179.1597 25.14 291.7002 140.0303 75.5 141.9004 61.6699 -76.4004 -5.01 -906 -73.9399

%Change 6.1154 5.8781 2.5426 1.9104 1.8048 1.6358 1.551 1.3174 1.2171 -0.4324 -0.4409 -1.702 -3.0388

BSE Sectoral Indices Security Name BSE IT SECTOR BSE TECK BSE OIL & GAS INDEX BSE REALTY INDEX BSE FMCG INDEX BSE AUTO INDEX BSE BANKEX BSE HEALTHCARE BSE POWER INDEX BSE PSU INDEX BSE MIDCAP BSE SMALLCAP BSE CAPITAL GOODS BSE CONSUMER DURABLES BSE METAL INDEX

CMP 5275.23 3251.55 8494.45 1762.96 3910.39 8498.42 10850.73 5867.8 2125.41 7403.82 6129.59 6881.08 10742.97 6361.41 10995.57

POD 289.6802 128.95 231.1104 39.5299 79.0798 78.9102 90 -4.0103 -12.6802 -81.4302 -93.21 -160.04 -421.311 -286.96 -518.23

%Change 5.8104 4.1296 2.7968 2.2937 2.064 0.9372 0.8364 -0.0683 -0.5931 -1.0879 -1.4979 -2.2729 -3.7737 -4.3162 -4.5009

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3rd Oct 2011

Weekly Technical Report Weekly Technical Report Weekly Technical Report Weekly technical Pick: DLF (CMP: 218.9) Stochastic (Daily): In a buy mode

RSI: Above 50 Intermediate Trend: Choppy Volume: Steady

Buying Zone

Target -1

Target - 2

Stop Loss

Time Horizon

Around : 210205

230

245

188 on closing

2 to 3 weeks

5555

3rd Oct 2011

Weekly Technical Report Weekly Technical Report Weekly Technical Report Weekly technical Pick: Insecticides (CMP: 380) Stochastic (Daily): In a buy mode RSI: Above 50 Intermediate Trend: Upward Volume: Steady

Buying Zone

Target -1

Around : 378382

405

Target – 2/3 412/424

Stop Loss

Time Horizon

348 on closing

2 to 3 weeks

Technical Research Team SPA Securities Ltd [email protected] [email protected] [email protected] Tele:033-40114821

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