| The market was unable to breakout from a trading range and there was a small sell off coinciding with the settlement. Nevertheless there were net gains. |
| The Sensex closed at 11,778 points for a gain of 1.178 per cent. The Nifty closed up by 1.46 per cent at 3345 points. The Defty gained a disproportionate 1.56 per cent as the dollar dropped after critical US data was absorbed by the market. |
| Breadth was thin, though it is to be expected at settlement. Volumes were low throughout, even on settlement day. Surprisingly, intra-day volatility eased off. The BSE 500 rose 1.32 per cent underperforming the F&O stocks. |
| Outlook The market appears poised on the edge of a breakout. If the Nifty/Sensex cross 3450 / 11,800 and close above that mark, with volume expansion, we can expect a near-term target of 3650/ 12,250. |
| The signs are reasonably propitious in that it has tested the resistance several times. On the other hand, if it fails to finally break that resistance, the downside could be till 3315. |
| Rationale Lower volumes and low volatility is a characteristic of range-trading behaviour. The market is still in an intermediate uptrend as it has been since mid-June. It could make an upside breakout this week. That would require strong volume action to be valid. |
| Counter-view The intermediate trend must be close to maturity and it could break and reverse in any given session of next week. The multiple tests of 3450 may have created a multiple tops formation, which is bearish. The lack of current volumes is also bearish. |
| Bulls & bears The banking sector outperformed this week as it has, ever since the Fed stopped hiking US rates and the rupee gained strength. The IT sector also outperformed this week. Both sectors look as though they could sustain a little more bullishness but there isn't an obvious pick in IT. |
| Among other sectors, auto stocks such as Bajaj, Hero Honda, Maruti and Leyland looked interesting. Among banking stocks, HDFC Bank, ICICI and UTI Bank look especially strong. Cipla and Ranbaxy are also looking bullish as is IPCL, ABB and Siemens. |
| MICRO TECHNICALS |
| BAJAJ AUTO Current Price: 2789.45 Target price: 2925 |
| Bajaj appears to have made a breakout on sustained volume expansion by closing above 2785. It should have a target of 2900 at least and it could go till 2925. Keep a stop at 2780 and go long. Book some profits above 2875. |
| CIPLA Current Price: 257.8 Target price: 270 |
| The stock has moved up on strong volumes in the past two sessions. It may have completed a breakout and it has a likely intra-day target of 270 at least. Keep a stop at 253 and go long. Take a call at 270 "� if volumes remain good, it could climb to 280-plus. |
| HDFC BANK Current Price: 876 Target price: 900.975 (long-term) |
| The scrip has climbed smartly but it faces powerful resistance at current levels so, it cannot be termed a breakout. However the trend looks bullish. |
| It will probably range trade between 870-900 for a while. A close above 900 would be a very strong signal setting a short-term target of 975. Until then, try to accumulate anywhere below 880. Keep a stop at 856. You may have to wait 10 sessions. |
| IPCL Current Price: 300.75 Target price: 315 |
| IPCL has seen a small sell off followed by excellent support coming in at 285-290. It has a likely target of 320 but it will hit some resistance between 300-305. Keep a stop at 290 and go long. Book profits above 315. |
| MARUTI UDYOG Current Price: 874.85 Target price: 920 |
| The stock has seen a sharp uptrend accompanied by some volume expansion. It has a target of 920. Keep a stop at 860 and go long. There will be a wide intra-day high-low range so, there is some additional risk in the position. |
| (The target price and projected movements given above are in terms of the next five trading sessions unless otherwise stated.) |
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