The Index cleared the 5300 resistance with ease
to finish the day at 5336. NIFTY is well poised to test its next major
resistance at 5350 breach of which can add fuel to the fire and we may see
brisk gains towards 5600 level.
Major stocks in the metal sector are in the sell zone on all
three counts as the Trend Score of HINDALCO, STER and TATASTEEL is deep in the
negative territory. All these stocks are deeply oversold and exhibiting a
sideways trend for an extended period. There is no specific reason to buy this
underperforming space at current levels but improvement in general market
conditions may trigger short covering rallies.
Traders with short position should cover the positions
on weakness while long only swing traders should accumulate the stocks on
weakness with a view to book gains after a rise of 5% to 10% in prices. Passive
long term investors should wait for the moving average setup to generate a buy
signal.
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