Nifty closes above 50DSMA after volatile trade due to 'short squeeze'!

Both the indices opened in positive territory initially, and oscillated between positive and negative terrain till afternoon, further fall in crude below US $127 comforted bulls to fight back, which forced bears to run for cover, and in the process 50DSMA is conquered on closing basis. Our markets have outperformed asian peers yesterday. Intraday 5DSMA was tested, rollovers improved, resulting in higher turnover, however, still large part of positions are outstanding to be rolled over today, which is the settlement day, for current series. VIX rose whopping 14% and closed at 32.63, indicating continuation of higher volatility further. May futures closed at 13 points premium to the spot. US markets have advanced further and closed with gains after volatile trade on mixed economic indicators. Singapore Nifty futures are currently quoting at 41 points premium indicate positive opening for our markets initially. Asian markets are trading with gains currently.

IOC has posted Q4 loss of Rs.400 crores, and informed the ministry that they do not have working capital to import crude beyond 15th Sept'08 levels. Already 20 petrol pumps in mumbai are out of stock of diesel, as per latest reports. HPCL also expressed same concern and wants the ministry and government to address the crisis looming urgently. Crude though corrected to 127$ has risen above 131$ on supply concerns, is now almost confirming the "oil shock" to the global economies. Tata motors and M&M have posted results below street expectations, owing to raising input costs. L&T, NTPC,HPCL,POWER GRID,SUN PHARMA, COLGATE and host of others will announce results today. Out of these the index heavy weights will influence market sentiment and movement today.

Settlement of Nifty whether at 4950......5000 or at which price will be interesting to watch after close of markets today. In my opinion it should be above 4830.25(march settlement) and below 4999.85(april settlement); today.

Range for the Day: Nifty might trade in the range of 4850 to 5000.