Resistance of moving averages intact

Markets on August 11, 2009: A relief rally

With profit taking towards end of today’s trading session, Indian markets trim some of
their earlier gains. Finally Sensex ended the day higher by 57 points, while Nifty closed
higher by 33 points. The BSE-Midcap and BSE-Smallcap indices also closed higher by
around 1.1% and 0.5% respectively. Today, Nifty failed to close above the hurdle of 20-
daily simple moving average (20-DSMA) and 20-hourly simple moving average (20-
HSMA), which indicates that the selling pressure is intense at higher levels. The only
level to watch out for is the support line of 4398, as below 4398 a new leg on downside
will began. Hence from here ever bounce will be a sell on rise story. On upside hurdle is
packed at 4540. Daily KST continue to remain in sell mode. Market breadth was almost
neutral with 682 advances and 549 declines.

Our short-term bias is down for the target of 4325 with reversal packed at 4732. However
our mid-term bias is still up for the targets of 5000 with reversal packed at 4325.

Auto, realty and metal stocks ended the day on the strong note, while select stocks from
the engineering and energy sectors ended weak. From the 30 stocks of Sensex Tata
Motors (up 7%), Mahindra and Mahindra (up 4%) and Hindalco (up 3%) led the pack of
gainers while Jaiprakash Associates (down 3%) and HDFC (down 1%) led the pack of
losers.