NIFTY MAY TOUCH 5180 TODAY

Strong signs from European and U.S. markets guide Nifty to touch its trading upper band around 5170.Amid the global economic doubt all the markets had dived. Because of small recovery in U.S. unemployment claim data and European debit crises, markets had rallied. Asian markets are following the Wall Street’s gain and trading higher. Singapore Nifty also trading higher on 5160, which is a strong resistance zone for Nifty. Technically Nifty has negative divergence in momentum indicators and a strong support at 5100 level for today. Nifty option data shows a range of 5100 to 5200 may be for two to three days. Closing above 5200 with high volume brake-out, Nifty may add more 100 points and it may taste 5300 level. Avoid trading in Nifty on these levels. Take position only in selected stocks.

HOW TO DO FUNDAMENTAL ANALYSIS OF STOCK?

Fundamental analysis is a broad subject, it cannot describe in few words .Basically stock prices depend on market movement called momentum but Fundamentals are the ground for investing. In fundamental analysis, analysts review the business model, its competitors, earning growth, sales growth, management, debts and Future prospects of company. Here, some important facts are described briefly.

Business model and Management

This is the basic fact for analysis of a company. What is the business model of company? How does company earn money? What is the demand of product, which company sells? Answers of these questions will help to know about position and status of company in market. Growth of a company depends on its product and management. A strong management helps growth of company year by year.  

Financial statement

Financial statement of a company does the key role in analysis. If company reports the sales, profit and revenue growth year to year, the company is growing. Growing E.P.S. helps to increase the stock prices in markets. Expenses of company must grow with sales of company.

Price to Earnings Ratio

Price to earnings ratio acts the key role to know fair value of stock. Most of analysts trust it. A lower P/E and high profit growth companies are the choice of big traders. 

SILVER HAS RESISTANCE ON $ 32.50 - $ 33.50

Silver had fallen sharply from $ 40 to $ 26.15 in three trading sessions last month. After worst decline, Silver has bounced back and touched $ 33.10.Silver is trading near this level from few days. Silver was highly oversold, when it touched $ 26.15. Now Silver is trading in its resistance zone. Silver is in extreme downtrend in daily charts, it is trading below its 200 day’s moving average line. MACD is also confirming its downtrend in daily charts. In weekly charts Silver has taken support from its 100 day’s moving average and this is a strong/crucial support zone for long-term charts. MACD is showing weakness in weekly chart also. Any further decline in Silver prices below $ 26, it will confirm deep downtrend in Silver for long-term. Silver is also facing resistance around $ 33 area. Silver will have to close over this level to add more in its prices. Equity markets have recovered in all over world after the strong European clues, but Silver has not recovered so far. Any bad news from European markets may hit silver prices again. It may taste $ 26 in near term again. Silver may short sell on $ 32.50 level with the strict stop-loss of $33.50 in closing basis. For Indian markets stop-loss level is Rs 57000.

NIFTY MAY CONSOLIDATE BETWEEN 5000 to 5150 LEVEL

Strong rally of European and U.S. markets helped to pull Nifty upside. Nifty tossed 350 points from its bottom made in last week. Nifty has tasted 5150 once again, which is the upper band of the trading range of Nifty. Hourly chart of Nifty shows a strong resistance zone at 5160 -5200.Nifty may consolidate around this level for few days. Nifty 5200 strike rate’s call has maximum positions which mark that traders are not comfortable to pull Nifty over 5200 level now. Traders had added short positions in 5100 strike rate’s call on Thursday. U.S. markets mixed last night, while Asian markets are trading in negative zone. Fitch has downgraded four European banks and placed seven more banks to review for downgrading. European markets may remain weak after this news. Only short positions can be added at higher levels in Nifty.

RESULT ANALYSIS – INFOSYS

The second largest software company of India, Infosys has reported   9.72% growth in consolidated net profit for the September quarter Rs 1906 Cr against of Rs 1737 Cr in the same quarter of previous physical year. Company also has reported a revenue growth of 16.58%, from Rs 6947 Cr to Rs 8099 Cr. Infosys increased EPS  guidance  Rs 141- 143 from  Rs 128 -130 for FY 12 .Stock closed at  Rs 2679.35 on Wednesday at NSE. Price to Earnings Ratio of company is 18.86 for FY 12, which is comfortable for investing in stock. Stock has closed above its 100-day moving average line with high volume brake -out .Stock may touch Rs 2830 in few weeks. Buying is advised in Infosys. 

NIFTY HAS FACED RESISTANCE AT 5050 AGAIN

Strong signals from U.S. and European markets have forced Nifty to open a higher note .With gapping of 60 points Nifty has opened on its resistance zone around 5040 and could not comfort at this level. After a gap –up opening Nifty has made lower top and lower bottom in intraday on Monday.  The supply was coming at higher levels in Nifty. Today Nifty may consolidate between 4935 to 5000 level. Asian markets are showing weakness in early trading after indication of U.S. markets, which have mixed last night. Result season will start from Infosys today, which is the main trigger for Indian markets. Trading in stocks is advised on this stage only.

STOCKS RECOMMENDATIONS FOR 12th OCTOBER

These stocks can buy with strict stop-loss.If stock open its first target then it can buy for second target.

STOCK	STOP-LOSS	TARGET	TARGET	TARGET
TATAMOTORS	174.65	177.85	179.45	181.95
BHARTIARTL	373.73	379.25	382.45	387.60
SESAGOA	220.45	225.95	228.75	233.20
RECLTD	174.83	180.85	184.05	189.30
JUBLFOOD	794.00	831.60	848.60	876.10

These stocks can short sell with strict stop-loss.If stocks open at first target then it can be sold for second target.

STOCK	STOP-LOSS	TARGET	TARGET	TARGET
IRB	167.35	164.50	163.35	161.30
DISHTV	79.55	76.95	75.75	73.80
TATASTEEL	437.00	431.00	428.00	423.25
EDUCOMP	276.00	266.90	262.60	255.65
HCLTECH	411.95	400.75	395.65	387.35