NIFTY Trend Score

Amid narrow ranges, NIFTY managed to eke out a positive return for the day and closed on the highest level since 3^rd April 2012. Around the close, the Index did its best to breach 5350 resistance but lack of momentum took its toll and the Index closed the day at 5347.90, up 27.50 points. Major positive contribution came from DLF (Trend Score -13), HDFC (Trend Score 17) and RELINFRA (Trend Score -13). All three stocks rose more than 3%. 

Going forward, we expect more gains as the Index has formed a good base above 5300 support and is looking set to go beyond 5350 level. As mentioned earlier, post 5350 next target is 5600 level.

Major gains are likely in the stocks with positive Trend Score. We advice investors to maintain passive long positions in the stock with positive Trend Score till the moving average setup indicate otherwise. Stocks with negative Trend Score are ideal candidates for short covering and may post sharp gains once the Index start showing upward momentum.

Yesterday, the Swing Trading recommendations performed modestly. Out of the 55 stocks and indices we cover, 35 were in the buy mode and posted returns in the range of +0.58% while 20 were in the sell mode and average returns were +0.90% (loss for short sellers).

Today, 40 stocks are showing buy signals while 20 are in the sell mode. We expect sharp gains in the stocks with buy ratings once the Index manages to stabilize above 5350 level today. Failure to do so may result in some profit booking and we may see below par returns.