WEEKLY INDEX OUTLOOK 25AUG TO 29AUG 2008

Short Term Trend: Negative bias.
Medium Term Trend: Neutral.
Long Term Trend: A correction or primary downtrend underway in finally, a Long term bull market.


BSE SENSEX
Resistance 15120; and a probable target also. Near term turns positive above here. Otherwise, go short for targets of supports below, if reverses from here.
Resistance 14835; a probable target also. Go short for the targets of supports below, if fails here.

(Previous Close or CMP 14401)

Support 14000; a probable reversal area between 14000 and 13700; but signs of negativity also start below here.
Support 13700; hope for the bulls if this level is respected! close below here can drag markets to 12500 levels again.



NIFTY
Resistance 4525; and a probable target also. Near term turns positive above here. Otherwise, go short for targets of supports below, if fails here.
Resistance 4445; and a probable target also. Otherwise, go short for the targets of supports below, if fails here.

(Previous close or CMP 4327)

Support 4220; a probable reversal area between 4200-4100. Negative signs emerge below here.
Support 4100; Hope for the bulls until this level is respected. A close below here can drag markets to 3900 levels again and cause negativity for medium term as well.



CONCLUSION
Volatility is expected this week though, there is not enough participation to say very high. Markets' inability to show strength and Nifty closing below 4300 last week, seems to have turned short term trend negative and medium term neutral. In other words, both bulls and the bears are in a tug of war. The clearer picture for near term would emerge by this Friday, hopefully!

In the absence of its own agenda, our market seems to have been taking diktats from the US and the Asian markets(We might have our own agenda in the form of nuke deal and economic reforms in days to come). There was lot of optimism in the US markets due to falling crude oil prices and some soothing words from Mr. Warren Buffet -the greatest successful investor of our times. But the Asian Markets do not portray a hopeful picture in near to medium term. The euphoria of Olympics there might die down soon to remind the real picture of slowing growth. Similarly, the optimism in the U.S. could also be short lived because the housing market there has not shown any signs of bottoming out and the recession may confirm its presence in days to come.

Coming back to our markets again, we advise squaring off of the existing short term long positions with every rise as we expect markets to move up, "in early part atleast", this week, in view of the US optimism and falling crude oil prices (Please also see our watchlist for the week below).

Short to Medium term buying (cautiously) is recommended in the zone between 4250-4150 of Nifty. Stop Loss for all the Long possitions is a close below 4100.

We wish you a happy trading!
Please keep a watch on our daily updates every morning.