| Week Ahead: Nifty could correct after 3850 |
| MACRO TECHNICALS |
| Devangshu Datta / New Delhi November 6, 2006 |
| Momentum and volume signals are weak suggesting a substantial correction ahead. |
| The market continued to generate gains, moving to new highs. The Nifty closed at 3805 with a gain of 1.77 per cent. The Sensex closed up 1.74 per cent at 13,130 points. The Defty was up by 2.63 per cent as therupee gained after the RBI released its busy season policy and enhanced projections. |
| Breadth signals were poor. Volumes were reduced and declines far outnumbered advances. The BSE 500 rose by 2.63, which was an underperformance compared to the frontline indices. |
| The Nifty put-call ratio was held at over 1.75 so the derivative market is still oversold and emitting bullish signals. The FIIs and mutual funds were positive. |
| Outlook: The current chart patterns suggest a Nifty target in the range of 3850. That |
