The market has shown strength over the last week. The same continued on the first day of the current week. The benchmark index - Sensex – closed 37 points up at 17,328.62, while the broad-based NSE Nifty was up 47.6 points, or 0.95%, to close at 5,068.95. The BSE midcap and BSE small cap with gains of 1.43% and 0.93% respectively, followed the suit.
For the trailing week the best returns were lodged by ADAG power house Reliance Energy. The stock closed at Rs 1349.50 or 24% higher than it was a week ago. Satyam Computer has seen good buying over the last week as the market participants could see some value. The stock posted 7% returns in just one week and settled at Rs 442 when the rest of the IT pack was busy fighting the appreciating rupee.
The Monday trading session started on a weak note. However, just one hour after the trading started the sensex moved into positive territory. The gains however were eaten into by the profit booking by market participants in the last half an hour.
The trading patterns show that the market is currently trading in a overbought territory and there is a correction on cards. Traders are advised to exercise utmost caution and stick to the stop loss. We advise investors to get out of all their leveraged positions at the first instance. Especially, the leveraged positions in the shares of Reliance pack should be existed.
We expect a 1000 points correction in the near future and hence advise caution in the market.
Disclosure: We are deemed to be an interested party in all or any of the indices/stocks in personal capacity or in the capacity of our clients.
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