NIFTY UPDATE

 

Nifty has closed well above its 200 DMA (which provided it with strong support) and is now poised to test new highs. As shown in chart above resistance exists at 5200 and then at 5300 which should act as a healthy pause in this market. Given time and strong global cues Nifty should cross these hurdles without major corrections and head for our long term target of 6800 as indicated by the Inverse Head and Shoulder pattern which has formed on the weekly charts around July 2009. A pause or slight correction would be a good opportunity to get into stocks which are technically well placed. I have a feeling that the time has come for mid and small caps to now make their move. Readers can look at stocks which have bounced off their supports and are yet to move close to resistances. Infrastructure stocks which have not performed so far could prove to be a good bet. If these stocks can be coupled with technically valid price patterns and bouncing off support levels, they can be bought into.