Crude touches 108 $ on dollar weakness

Our indices opened gap down on weak global cues and Sensex almost touched January low, where fund buying coupled with short covering, brought the Nifty into positive territory, after very volatile trading. Higher volatility is an indication of either bottom formation or top formation. Since we are in down trend, it may be an indication that our indices may be trying to find bottom. Nifty closed just at 4800, in positive territory, where as Sensex marginally in negative territory, both far away from 200DSMA levels which now stand at Nifty(5067.63) & Sensex(17230.93).

 

Crude touched 108$ per barrel on the weakness in dollar, and seems to be stabilizing above 100 levels; is a cause of concern for all economies figting raising inflation. US markets tanked once again overnight due to bad results from Black stone, and asian markets are trading negative. Singapore futures point to 120 points gap down on Nifty at present, and we can expect the volatility to continue today too. Revisiting January levels is being advocated by most of the technical analysts, and some are expecting even breach of the same too.

 

The long term bull market is under threat now, as the sentiment is very weak, since companies like L&T also are taking hit on account of other than their main business(it reported a loss of Rs.200 crores on hedging in commodities market). Liquidity pressure shall be there till corporates plan their advance tax payments due by 15.03.2008.

 

Range for the Day: Nifty might trade in the range of 4650 to 4950 for the day.