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Prices
likely to remain firm
Deepak
Singh Tanwar
The uptrend continued on Wednesday and the Sensex managed
to gain another 43 points. The gain was contributed by ITC,
Reliance, Ranbaxy, Cipla, Dr Reddy’s and Reliance Petro.
There has been a steady improvement in the sentiment and selective
buying continued to keep stocks firm. The performance of IT
counters was relatively positive.
However, Infosys reacted from its high. The level of Rs 2,840
should be used as strict stop-loss for long positions. Immediate
hurdle should be at around Rs 3,100.
Digital Equipment has also reacted from Rs 315 and this should
be considered as an immediate resistance. The level of Rs
255 is an important support.
Satyam Computer also remained firm. While the immediate base
lies at Rs 143, the next support for counter is at around
Rs 134.
Wipro also improved smartly but is close to its important
hurdle of Rs 1,200. For HCL Tech, the-stop loss for long position
is at Rs 143.
The performance of domestic pharma counters was impressive.
Dr Reddy’s improved smartly and a further improvement is not
ruled out. The first support for the counter is at Rs 924
and the next base is at
around Rs 840.
Cipla, too, improved and the next resistance is at around
Rs 1,200. The level of Rs 1,020 should be used as stop-loss
for long positions. Till this level is broken, the medium
to short-term position is likely to remain positive for the
stock.
For Ranbaxy, the key level is Rs 650 and the long position
should be liquidated only below this level.
ITC also showed impressive rally and the force of uptrend
suggest that it may continue the trend. It has a strong hurdle
at around Rs 720.
Reliance improvement further and the level of Rs 300 should
be an immediate resistance.
The cement counters witnessed profit-booking and a sideways
move
is expected.
MTNL, RPL, Bhel and SBI may remain in a narrow range in the
near future.
Overall, with an improvement in sentiment, selective buying,
especialy in the domestic pharma sector, is likely to continue.
IT sector, however, may witness profit booking at higher levels.
(The analyst has a long position in Cipla, Ranbaxy and
Dr Reddy’s Labs)
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