MARKET PULSE: Short report for 6th March 2012
Currency market
Rupee is weak with risk of test/break of 50.00 for extension into 50.50 to get into a new near term range of 49.50-50.50 (within the set short term range of 48.50-50.50). This move should ideally complete the end-to-end move to set up a gradual rupee appreciation into the lower end. In the meanwhile, USD Index is unable to hold on to its gains above 79.50 but reversal from there is shallow. For today, let us watch 49.85-50.15 with test/break either-way to attract. Exporters can look to sell April 2012 dollars above 51 (spot move into 50.35-50.50).
EUR/USD is in consolidation mode at 1.3150-1.3250 and lacks momentum to provide directional break-out. Let us watch consolidation at 1.3150-1.3300 with overshoot limited to 1.3100-1.3350. The strategy is to buy at 1.3150-1.3100 (with stop at 1.3075) and sell at 1.3300-1.3350 (with stop at 1.3375).
USD/JPY entered into set buy zone of 81.25-80.75 (low of 81.13) and in consolidation mode around 81.50. Let us continue to watch consolidation at 80.50-82.50 and trade end-to-end with stop/reverse on break thereof. In the meanwhile EUR/JPY is solid above 107; lower end of set near term range of 107-110. No change in view and trade strategies remains unchanged.
Equity market
NIFTY stayed under pressure throughout the trading session for a gradual fall from 5344 to 5265 before close at 5280; within the set buy zone of 5315-5265 for fleet footed traders. It also triggered the first lot entry for strategic investors at 5300-5275. Now, the big trigger will be from RBI as domestic cues are very weak at this stage. The immediate support is at 5210 followed by 5080 which should hold in the near term. Strategic investors can continue to watch the next/second lot entry at 5200-5175. For today, let us watch tight consolidation at 5210-5360 with test/break either-way to attract. Fleet footed traders can cut the long position and choose to trade from short side by selling at 5325-5350 with tight stop for move into 5210/5080 before sharp reversal into 5500-5600.
(Refer to Weekly update for other asset classes).Have a great day ahead....................Moses Harding
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