Nifty NSE and stock calls for tomorrow (28th Oct 2011)

Nifty is celebrating this Diwali with good gain and breaking out above 5200. Let’s see how thing develops in coming days, we guess yes, it will rally towards 5300-5450.

Figure 1 Nifty Day Chart

In fig. 1, it is clearly seen that Nifty has made double bottom reversal pattern at around 4720. And now it has broken its strong resistance horizontal Trendline stood at 5174 today. More and more buying will come if it sustain above this level for next 4-5 days. 

We had given buy call for Nifty on 10^th October 2011 at 4940 when it was moving up after making second bottom and breakdown the Trendline.

So now in order to break this it has two major challenges ahead: -

         i.     

• One is to fill up window (or gap) of 5325-5233 which was happened in Aug 2011 as seen in fig. 1.

•   And the second one is bearish Trendline as seen in fig.1. It is tested 6 times since November 2010 so importance of this Trendline is much higher than anything.

So by observing fig.1, it is very much clear that Nifty has been making lower top since Jan 2011, and if it manages to cross this Trendline then we will be very lucky to see next primarily bull market.

Stocks specific

Bombay Dyeing seems to be good from past few days and we hope that it should move with the same in the coming times too. We have extracted some of the technical’s for this stock and represented it as follows: -

Moving Average for Bombay Dyeing       

                                                                               Fig: -

From the above figure we can see that 20 days MA has crossed over 50 MA which is buy signal for the stock of Bombay Dyeing. This Moving Average indicator has given the signal to buy this stock.

 Fig: -

From the above figure it is clear that this stock is trending upwards since from the month of September 2011. This stock is making upper bottom which is again a strong signal from the trendline.

                                               

Another indictor called ADX is showing the positive signal for the stock where its +DI has –DI in the mid of September month. It was signal given far earlier.

Fig: -

And the last but not the least the RSI indicator which moving towards the overbought region.

  

Fig: -

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