Daily Nifty & Rupee Outlook for 20th Oct 2011

Nifty: Nifty yesterday after gap up opening at 5077 traded positive and tested the higher resistance trend line at 5154 where closing was just at the resistance level of 5140 indicating sharp pull back in market. Today with the Asian market trading negative its expected opening sharply down side where on lower side if opening is below 5100 will bring to 5020 level on lower side where as further trading below 5000 will open the door for 4740 which is the lower trend line. Nifty is forming Bearish Flag Pattern and below the support of 4760 on closing basis will confirm the down side break out where as on higher side 5150 is the near term resistance level on closing basis from where its showing sign of reversal, where further crossover above 5170 will confirm the uptrend. Stochastic has given negative intersection are trading below 80% zone where short selloff in price can be expected.

USD/INR: Rupee yesterday tested the level just below 49 but fails to sustain below the same and closing was seen at 49.16 with the positive move in Dollar index. Today the opening is positive at 49.43 per$ but fails to cross the lower resistance of 49.5 per$ level. Immediate support is seen at 49.25per$ and further crossover below 49.25 per$ will bring to 49.1 to 48.9 on lower side. On higher side if sustain trading is seen above 49.4 will bring to 49.5 – 49.75per $ which is the resistance level and RBI intervention was seen at 50 per$, further above 50 per$ will bring to 52 to 53.5per$ in near to medium term which is expected target till the time 48.7$ holds on closing basis. I expect it to move upsdei beyond 50 in near to medium term for higher target. Dollar index after testing 76.56 gave a sharp reversal in price where yesterdays closing were seen above 77, and currently it is trading at 77.20 and is near the resistance of 77.3 level. Rupee is expected to trade in range of 49.7per$ to 49.25per$ for the day. Stochastic are trading in mid zone and with positive intersection is trading at 40% zone which indicates upside move can be expected.