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Trading Strategy for the week ending December 5, 1999

Sensex: This week is very crucial for Sensex and for the market. Expect one side heavy movement from Wedensday onwards in this week. Index will hundred percent top out. Sensex will complete 34 days and 8 weeks from the top of 5150 level. On going rally in the market is of corrective nature only. Traders are advised to offload and can even go short in Software stocks from December 2 onwards. It looks like that in the coming days there may be a vertical fall in software stocks, Sensex stocks are also not looking strong. Index will have to cross 4797 level then only expect miracles, otherwise expect free fall from Wednesday onwards.

Hindalco & Indian Alum: Grab both these stocks they are looking really very hot buy. Hindalco is ready to start its third wave and it will be of very dynamic of nature. Considering Rs 840 as weekly support level, buy this stock. On upper side it can flare up to Rs 895 or expect a level of Rs 925. In coming three trading sessions it may cross Rs 1,000 level. Below Rs 840 it can slide to Rs 810. Correction is over in Indian Alunminum above Rs 98 it will favour bulls only. On upper side it can flare up to Rs 108, Rs 118 or Rs 128 is also possible. Charts of both these stocks are indicating that some favouarble news related to Aluminum industry will flash very soon.

BPL: Falling wedge and days count method are indicating that worst is over for this scrip and mechanical indicators had given positive divergence and buy signal too. Decisive close above Rs 330 level will take scrip straight up to Rs 377, Rs 392 or expect level of Rs 440 in the coming days itself. Buy this stock on every decline, one side movement from Wedensday onward not ruled out and it will favour bulls only. Downward support levels are Rs 310 and Rs 295.

Finolex Cable & Sterlite: Rounding top and lack clouds in Finolex Cable will favour bears and scrip is ready to start its third wave on downside. So in coming days traders can expect heavy selling in this counter. Sell this scrip on every rise. Below Rs 246 it will be in the firm grip of bears only and it can slide to Rs 222, Rs 208 or Rs 195 is also possible. If it crosses Rs 246 then it can flare up to Rs 260. On going rally in Sterlite is of corrective nature only. One side movement from Wedensday is not ruled out. The level of Rs 400 is a trend decider. On upper side it can flare up to Rs 424, Rs 440 and major hurdle exists at Rs 454. On the downside in this week it can slide to Rs 385 or Rs 360 is also possible. Sell both these scrips if revives.

Satyam: Scrip has broken a ascending triangle last Wednesday and the height of triangle is Rs 900 and the break out point was Rs 1,730. So it looks likely that the scrip will steadily move up to Rs 2,600 levels in the coming days. Traders have an eye on these levels and may be very helpful too. If it trades above Rs 1,910 level then it can flare up to Rs 2,021, Rs 2,058, Rs 2,170, Rs 2,206, Rs 2,318, Rs 2,355, Rs 2,466, Rs 2,503 or Rs 2,615 is also possible. Consider these levels as crucial resistance points for coming days. Weekly support exists at Rs 1,830 level, below this level it can easily slide to Rs 1,730. Above I have mentioned that there may be vertical fall in software stocks, but exceptions are there, so be cautious.

Zee Tele: Last week it was mentioned that this scrip will flare up to Rs 5,930 level, after hitting Rs 5,959 level it has closed at Rs 5,857. Scrip has formed expanding triangle in both daily and weekly chart and it indicates that ultimately there will be heavy allround selling in the coming days. The last hurdle for this week is Rs 5,908 level, decisive crossover above this level will take the scrip up to Rs 6,120, Rs 6,250 or Rs 6,380 is also possibl.e. Weekly support exists at Rs 5,700. Below this level expect a free fall and the scrip may slide to Rs 5,440 or Rs 5,230 is also possible. Triangle is indicating that scrip is on the edge and it will fall very heavily after a minor spurt.

EID Parry, Subhash Project and Liberty Shoes: All these three stock are live wire and looking very hot and it looks that they may jump by 100 per cent in the days to come. Traders can refresh their memory about Jain studio, Sandesh and KLG Syst. EID Parry has broken a triangle on upper side and it looks that it will rally up to Rs 175 or Rs 195 is also possible. Subhash Project is ready to start its third wave and once crossover above Rs 141 level happens, it will take the scrip up to Rs 175 and there after sky is limit. Above Rs 118 and Rs 110 it will favour bulls only. Buy Liberty Shoes on every decline. It has already broken triangle and it may spurt up to Rs 160. Minor hurdle exists at Rs 130. Instead of trading in these scrips take delivery for a period of one month.

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