After the pullback seen in the last four days, the Sensex and Nifty are heading towards the 200 days moving average (200-DMA).
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The Sensex's 200-DMA is 17,150 and that for the Nifty is 5,020. The intermittent rallies that have taken place since January could not propel the relative strength index (RSI) above the 50-60 band. The Sensex's RSI is around 56, while it is 60 in case of the Nifty.
TECHNICAL TARGETS Sensex stock trading closer to 200DMA |
Name | Current price | 200DMA | @ | Reliance Ind | 2,298.70 | 2,340.38 | 1.81 | NTPC | 196.75 | 202.59 | 2.97 | Tata Motors | 679.40 | 716.71 | 5.49 | Larsen & Toubro | 3,046.30 | 3,227.74 | 5.96 | Reliance Energy | 1,297.65 | 1,380.92 | 6.42 | Satyam Computer | 413.00 | 440.26 | 6.60 | Maruti Suzuki | 845.35 | 902.17 | 6.72 | Mah & Mah | 680.05 | 726.03 | 6.76 | BHEL | 1,954.95 | 2,089.79 | 6.90 | SBI | 1,713.60 | 1,838.85 | 7.31 | @ per cent change of 200DMA price |
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The markets corrected on Wednesday, with the Nifty closing lower at 4,820, down 50 points, and the Sensex ending at 16,060, weak by 130 points. Profit-taking was inevitable after four uptick days.
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Vibhav Kapoor, chief investment officer, IL&FS, expects the Sensex to make an attempt at crossing 16,800-17,000 as the markets will have to technically move towards these levels after the recent recovery. This is also the 200-day moving average for Sensex, he said.
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Of the 30 Sensex stocks, only seven are trading above the 200-DMA, while 23 are quoting almost 5-20 per cent below their 200-DMA. The stocks trading below 200-DMA are Cipla, Ranbaxy, Hindustan Unilever, ITC and HDFC Bank and these have a low weightage on the Sensex.
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HDFC and ONGC are the only two index heavyweights which are trading above the 200-DMA. Reliance Industries is trading at Rs 2,300, almost two per cent below its 200-DMA of Rs 2,340.
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The next technical target for Reliance would be the 50-DMA, which is Rs 2,504. ICICI Bank, which has corrected severely after suffering mark-to-market losses in derivatives, is trading 25.6 per cent below its 200-DMA of Rs 1059.26.
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The stock is trading at Rs 843.25 on Bombay Stock Exchange. Larsen & Toubro, however, has recovered from its recent slump and is now trading a mere six per cent below its 200-DMA. |
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