Is that a much awaited Recovery???... - Uttiya Chandra

P r o f i t i s t h e A n s w e r

 

Volume 2 : Issue 6, 8th September 2011 Total Pages: 4

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Hemal Kampani

Re. 1/-

Dear Friends, In my last communication of August 08, 2011, I said that some of the events which ultimately drag down the market are not events that either our Research or Technical Team can guess. However, at the third paragraph I said that a major im-provement upwards in the month of September and October is expected, which is now happening. After Nifty touched 4720 on August 26, 2011, it has started moving upwards and while I write this communiqué, Nifty has come back to where we started a month ago at 5118. I feel and maintain that the market will go up and you will have rich harvest in the month of October, if you buy Nifty stocks as per our Research recommendations. I am advising my Research Team to publish selective Nifty Stocks which will reap rich harvest in the month of October. As per our Research, buy at every dip and maintain strict levels as advised by them. Internationally, America has woken up to the fact that it needs to do something very drastic to see that their economy is on the right path and the signs that we getting are promising. With seasons greetings and a profitable Bijaya to all our Clients, this may be the right time to enter the equity market as advised and please look also for our Spot Exchange offerings and have the heart to create a savings of Gold, Silver etc., and inculcate the habit with your spouses to have a great balancing of investments.

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 NIFTY   SENSEX 

   5153.25  17165.54 

NIFTY AS ON DATE OF CONSIDERATION: 8 September 2011

Domestic Economic : Looks ahead - Ayush Killa

Indian equities rose to the highest level in three weeks as overseas investors bought shares amid speculation the cen-tral bank may halt its record series of interest-rate increases as growth slows. August wholesale-price inflation data is due on Sept. 14, two days before the central bank’s meeting. Slowing growth may prompt the Reserve Bank to pause rais-ing rates.

India attracted a record amount of foreign direct investment last quarter, signaling confidence in the nation’s economic prospects even as its equities market in August had the big-gest outflow of overseas funds in three years. The CHART OF THE DAY tracks India’s FDI, which was $13.44 billion in the three months through June, a record high for any quarter, according to commerce ministry data. The lower panel shows foreign investors sold a net $2.34 billion of stocks last month through Aug. 25, based on data compiled by Bloomberg. That’s on pace for the biggest outflow since October 2008.

The Bombay Stock Exchange Sensitive Index has returned an average of 26 percent in dollar terms annually in the nine-year period through December 2010, compared with a 3.6 percent gain by the MSCI All-Country World Index and a 15 percent advance by the MSCI Emerging Markets Index. The Indian gauge has plunged 19 percent this year as the central bank raised its repurchase rate 11 times since January 2010 to damp rising inflation.

India’s industrial production grew at the quickest pace in three months in June, weathering the fastest interest-rate increases among Asia’s major economies. Output at facto-ries, utilities and mines rose 8.8 percent from a year earlier, following a revised 5.9 percent gain in May. The median of 23 estimates in a Bloomberg News survey was for a 5.5 percent advance. - Contd. in Pg - 3

Sectoral 30 days Return : (7/08/2011- 8/09/2011)

We had a painful month in August series. Nifty closed at 5011, which was 480 pts down from the previous month`s closing. The fall was so drastic due to global turmoil (US Debt crisis & credit rating downgrade, Europe debt crisis) that nobody could sell rather they got stuck at every higher level. Nifty made a low of 4720 & has given a sharp ” V “ shape recovery till today (06th Sept.), where NIFTY closed at 5124.65.Now the million dollar question comes “ Where are we heading & what to do? ” .Being a technical analyst, charts are showing that it’s a pause or a technical pullback before a big fall. As because overall mostly, the beaten down stocks such as I.T, METALS, INFRASTRUCTURE , RELIANCE , ADAG PACK & BANKS all were in “oversold category” in short term charts.

September is also going to be an eventful month for global economy with events like Obama’s speech, FED meet & also RBI credit policy for Indian economy. Monthly chart of Nifty had a lower top & lower bottom which indicates a clear cut downtrend (chart attached). As mentioned above Nifty got a stiff recovery technically, which is un-healthy for any financial assets. In this rally, Nifty may retest 5200 level which it has almost done (made a high of 5154.50). Above 5200 it may move further towards 5250; 5310.For the time being Nifty will take support at 5070; 5020.

LOC (Line of Control) of Nifty stands at 4940, with 1% filter at 4900.Below 4900 it may retest its previous bot-tom or make a new low in coming days. Traders should follow these strategies as mentioned below:

• No long term buy at current levels. Trade only in calls given for intraday and short term, maintaining a strict stop loss. • Book profit in NIFTY & STOCKS if they have any • Sell short in NIFTY with closing ba-sis stop loss at 5330 on weekly basis Book or minimize their losses in stocks specially I.T, METALS, INFRASTRUC-TURE , RELIANCE , ADAG PACK & BANKS & seat with cash to cover or re-enter at lower levels

I hope traders may take the advantage of this view & make profits.

Wishing you a very Happy Puja.

2007 A M J J A S O N D 2008 A M J J A S O N D 2009 A M J J A S O N D 2010 A M J J A S O N D 2011 A M J J A S O N D 2012 A M J J A

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LOWER TOP & LOWER BOTTOMIN MONTHLY CHART

S&P CNX Nifty (5,109.80, 5,154.50, 4,942.90, 5,124.65, +123.650)

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" V " SHAPE RECOVERYIN WEEKLY CHART

S&P CNX Nifty (4,998.90, 5,154.50, 4,942.90, 5,124.65, +84.6499)

Dates to Watch out for….

Nifty Stocks that can be invested in...

Happy Durga Puja ‘2011 Happy Durga Puja ‘2011 Wishing You A Wishing You A

STERLITE, TATA STEEL, ICICI, PNB, CANARA BANK, INFOSYS, BHARTI, HPCL, L&T

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Stock To Watch Out - Deepak Tewary

Source : Bloomberg, VCK Share & Stock Research

Pidilite Industries Ltd: CMP 168 (52 wk H/L - INR 183/123)

Company description - Pidilite Industries is the largest branded adhesives player in India, with an iconic brand like Fevicol. Besides a strong presence in adhesives, Pidilite expanded its presence in emerging seg-ments like mechanized joinery, modular furniture, flooring, automotive care and waterproofing through Dr Fixit and Roff.

Key investment arguments

1.Strong consumer driven demand to continue and drive ~15% volume growth in the future. 2.Strong brand leadership and pricing power will help in margin

expansion. 3. Successful completion of a synthetic elastomer project (estimated cost INR 5.5billion; INR 2.8billion

already spent) can provide earnings upside after FY12.

Key investment risks

1. Continued increase in VAM prices could impact margins in the near term as price increases will be with a lag.

2. Delay in commissioning the elastomer project and longer-than-expected payback period could strain cash flows.

Recent developments - Price increase of 5-6% being taken at the end of June to cover the cost push in VAM other inputs will reflect in margins from Q2FY11.

Valuation - Pidilite has strong pricing power in consumer products, and margins will rebound in the coming quarters, as the impact of the price increase takes effect. We believe Pidilite is a compelling play on the expected growth opportunity in home interiors and construction. The stock trades at 22.9x FY12E EPS of INR7.4 and 18.6x FY13E EPS of INR9.1. One can BUY this stock given its defensive nature and moderate growth.

Bafna Pharmaceutical Ltd (BSE:532989): CMP48.5 (52 wk H/L - INR 60/36) Company description - Bafna Pharmaceuticals was launched in 1981 as a proprie-tary concern. In 1984, the manufacturing facility of the company was set up in Mad-havaram, Chennai. Though the plant was initially into manufacturing tablets, it gradually expanded to a capsules and oral syrup facility. Currently the plant func-tions as a purely export oriented unit.

Earlier the focus was on institutional supply, followed by generic formulations and later to overseas market. A major breakthrough came when Bafna bagged a manu-facturing contract from Croslands Generic Division.

In 1995 it received WHO Good Manufacturing Practices (GMP) certification. In 2001, Bafna entered the Sri Lankan market with generic formulations. The market proved profitable and today the company has registered 57 products in Sri Lanka. In 2005 Bafna received the 'Best Supplier Award' from the State Pharmaceutical Cor-poration of Sri Lanka. Their success in the island nation gave Bafna the confidence to explore their options in other nations too and the company was soon eyeing the African market. Currently Bafna exports its products to Ghana, Laos and Ukraine and is planning to expand its presence in other African countries.

Setting high target – Bafna Pharma now plans to reach a turnover of INR 500 crore by 2015 from INR 100 crore topline in FY11.

Tapping the regulated market - With intentions to step into regulated markets, Bafna launched a new plant in Grantylon Village near Chennai. Spread across 2.65 acres of land, this 65,000 sq ft plant and has got approval from UK MHRA (Medicines and Health Care Products Regulatory Agency), gateway to the Euro-pean market. The Grantylon facility will make non-betalactum products in solid oral and dosage forms. It has got 17approvals from UK.

Contract manufacturing – Bafna Pharma also does contract manufacturing for companies in UK like Somex Pharma, Relonchem, Boots and Crescent Pharma and for deomestic companies like Cipla and Biocon.

Betting on acquisition – Recently Bafna acquired Johnson & Johnson’s Raricap, a haematinic drug used to treat iron deficiency anaemia for about INR 20 crore. Rari-cap has domestic sales of INR 13 crore. However, according to Bafna Pharma, Raricap suffered from lack of marketing support and with aggressive marketing it hopes to achieve turnover of INR 50 crore annually.

The company also plans to take over a UK company on an on-going basis, which would allow it to get into ‘market authorizations’, wherein there is a commitment from global pharma majors to buyback the products.

Valuation – At CMP of INR 49.20, the stock trades at expensive valuation of 18.2x its FY11 EPS of INR 2.71. The company plans to achieve topline of INR 150 crore and bottomline of INR 10 crore in FY12E. This translates into an EPS of INR 5.7 and PE of 8.6x. Even at this valuation the stock looks fairly valued and hence we recommend investors to accumulate the stock on every decline with two year time frame. In FY13, the company expects to achieve topline of INR 225-230 crore with net profit margin of 10%.

High Risk High Gain - Deepak Tewary

Last Five FY (in INR mn) 

  FY11  FY10  FY09  FY08  FY07 

Income  1,013.0  751.8  472.5  398.4  355.9 

Expense  901.2  671.2  412.1  376.3  336.0 

PBIDT  111.8  80.6  60.5  22.1  19.9 

PBIT  89.2  63.2  46.8  18.6  16.3 

PBT  46.2  40.0  26.1  13.0  11.2 

PAT  47.4  24.8  10.7  12.0  9.7 

Equity  174.8  159.8  159.8  95.8  38.7 

EPS (INR)  2.7  1.6  0.7  1.3  2.5 

FV (INR)  10.0  10.0  10.0  10.0  10.0 

Last Five FY (in INR mn) 

  FY11  FY10  FY09  FY08  FY07 

Income  23,956.0  19,594.2  17,850.1  15,589.4  11,721.0 

Expense  19,235.4  15,515.9  15,359.2  12,755.8  9,787.2 

PBIDT  4,720.6  4,078.4  2,491.0  2,833.6  1,933.8 

PBIT  4,276.7  3,614.5  2,018.8  2,448.6  1,631.1 

PBT  3,975.2  3,288.7  1,632.0  2,242.8  1,539.8 

PAT  3,038.9  2,891.2  1,463.8  1,879.5  1,197.0 

Equity  506.13  506.13  253.07  253.06  252.39 

EPS (INR)  6.0  5.7  5.8  7.4  4.7 

FV (INR)  1.0  1.0  1.0  1.0  1.0 

Income Funds  Nav ( ` ) 1 Month

(%) 3 Month 

(%) 6 Month 

(%) 1 Year(%) 

3 Year(%) 

5 Year(%) 

Size( ` in Cr) 

ING Income Fund ‐ Inst (Bonus)  15.0986  ‐0.63  23.16  10.57  17.13  11.51  8.18  15.72 

ING Income Fund ‐ Bonus  14.5492  ‐1.19  22.58  10.05  16.66  10.68  7.25  15.72 

Kotak Flexi Debt ‐ Inst (Div‐W)  10.3579  28.79  15.79  12.7  10.22  7.72  0  2071.68 

IDFC SSIF ‐ Invest ‐ A (Div‐Q)  11.3596  7.06  15.37  10.65  7.34  8.55  8.12  304.77 

UTI‐Bond Fund (G)  29.7014  11.24  14.72  13.62  9.1  8.1  7.01  296.89 

UTI‐Bond Fund (D)  11.9067  11.24  14.72  13.64  9.12  8.13  6.57  296.89 

IDFC Dynamic Bond Fund ‐ B (G)  11.7131  9.32  13.42  11.7  8.74  0  0  50.9 

IDFC Dynamic Bond Fund ‐ B (D)  10.9445  9.31  13.42  11.69  8.73  0  0  50.9 

IDFC SSIF ‐ MTP ‐ Plan B (G)  11.0597  9.66  13.34  10.81  7.89  0  0  163.52 

IDFC SSIF ‐ MTP ‐ Plan B (D)  11.9473  9.67  13.34  8.14  4.23  0  0  163.52 

Top Performing Income Funds - Nabankur Roy

Technical View 

Weak below‐ 165 by Closing  Support ‐153  Resistance‐ 174 

Technical View 

Master Stop ‐ 39 By Closing Resistance‐ 50,54  

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Throwing away the bad investments:

Several investors believe that money can be made by buying the right investments at the right time. If they select a good investment and time their decisions well, they think that it’s enough. They never tire or pondering over the investment opportunities that they've missed. However, this same atten-tion is not paid to all the bad investments in their portfolios. In truth, an investor's portfolio suffers more due to the incorrect/bad decisions that they do not acknowledge and even try to correct. Holding on to a bad investment may be far worse than not selecting the right ones.

While the entire universe of investments is potentially avail-able for buying, but the decision to sell only involves what the investor already has in his portfolio. According to behavioral economists, one of the main reasons for our constant refusal to sell an investment is our aversion to loss. If our investment turns out to be good, we are happy to sell and feel good about the gains and our smartness. However, booking a loss is painful, so we tend to postpone the regret we feel at having made the wrong decision. We choose to wait out, ignore, or worse, add more to a poorly performing investment, hoping to average out the cost, just because most of us refuse to ac-cept our wrong investment decision and try to justify them. Cleaning up a portfolio is a tough task and calls for rational decision-making. Here are some ways to discard the bad ap-ples from your portfolio.

The rate of return of a portfolio is the weighted average of what we hold in it. If some of our money is stuck in bad in-vestments that show a negative growth, or don't work as hard as the others, we are losing out on the overall gains. Remem-ber, if the money from a bad investment is released and rede-ployed, it may end up doing better.

If we are reluctant to make the decision, it may help to begin with a partial liquidation of the investment that is performing poorly and comparing it over a period of time. When we see how the loss could have been arrested and funds redeployed, we may be able to rebalance the portfolio with greater confi-dence.

The decision to sell should also be independent of what needs to be bought. This is to avoid the double jeopardy of booking a loss and using this money to buy something that is too expensive. Several investors tend to book a loss when they bet on an IPO. Such decisions reach a peak when the IPO is touted as the next best thing and investors gather the courage to sell the earlier investments that did not work for them. If the buying decision is being made amidst hype, it runs a high risk. Reviewing the portfolio means answering a simple question: Will I make this investment decision today? If the answer to this question is, 'No', then the investment needs a clear-headed review and a possible sale, even if it is at a loss.

So remember, the decision to cut your losses is as important has booking your profits.

For the first time in over five months, the food inflation figure has climbed to the double-digit figure of 10.05 percent with a steep rise in the prices of onions, vegetables and fruits. Ac-cording to official figures, annual food inflation skyrocketed to 10.05 percent for the week ended August 20 as compared to 9.8 percent in the previous week. It has entered the arena of the double-digit for the first time since the week ending March 12, 2011, when it stood at the same level. India’s rupee fell by the most in more than a week after over-seas investors pulled money from local stocks on slowing growth and accelerating inflation. The currency slid 4.1 per-cent in August, the biggest monthly decline since May 2010, as foreign investors sold $2.3 billion more Indian shares than they bought, exchange data show. The economy expanded 7.7 percent in the second quarter, the least since 2009, ac-cording to a report released Aug. 30. Offshore forwards indi-cate the rupee will trade at 46.37 to the dollar in three months, compared with expectations of 46.31 at the end of last week. Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in dollars.

Domestic Economic - Contd. From Pg. - 1

S2  S1  Stock Name  R1  R2 

855  876  ICICI BANK  905  940 

1715  1755  BHEL  1825  1890 

535  549  JSPL  575  600 

750  776  RIL  850  885‐900 

126  132  STERLITE  143  150 

Few support and resistance to Trade-in

Trader’s Zone - Uttiya Chandra

Gold not a Bubble Gold's rally above $1,900 an ounce shows no signs of a "bubble" as central banks continue to boost money supply that has helped spur bullion to a record, according to investor Marc Faber.

"I don't think that gold is in a bubble," Faber, publisher of the Gloom, Boom and Doom report, "When you buy gold, it's an insurance against systematic failure and problems in the financial markets."

Gold climbed to a record $1,921.15 an ounce on the 6th of this month, underscoring Faber's contention that de-clining equities and weakening currencies will support demand. Speculative buying had pushed the gold market into a "bubble that is poised to burst,"Wells Fargo & Co analysts led by Dean Junkans had said in a report last month.

"I'd buy every month a little bit of gold," Faber said.

Manufacturing slowed in the US Europe and Asia, adding to signs of slowing global growth that may force cen-tral banks to step up stimulus measures.

The Federal Reserve completed its second round of so-called quantitative easing in June, whereby the central bank purchased $600 billion of Treasuries from November 2010, after injecting $1.25 trillion in the first round.

Goldman Sachs Group and Citigroup see the Bank of England restarting bond buying as early as this week as the economic recovery weakens and bank-funding costs increase.

Holdings in exchange-traded products backed by gold rose to a record 2,217 tonne on August 8, and stood at 2,142.4 tonne as of5th September, Bloomberg data shows. Gold is in the 11th year of a bull run, the longest rally since at least 1920 in London, as investors seek to diversify away from equities and some currencies.

-Source: ET

Real interest rates (Interest rates minus inflation) are down globally: This would result in gold yielding better returns than stocks or bonds.

The declining dollar: Gold rises when currency falls.

The ETF effect: With the introduction of exchange-traded funds (ETFs) in 2003, investors can now buy into the gold market at the click of a mouse. What’s more, investing in ETFs is less risky than investing directly in gold mining. The convenience by which indi-vidual investors can get onto the gold rally in propel-

ling the rally itself.

International rally: Gold is rallying worldwide, and this isn’t just a local phenomenon.

Increased fabrication: Emerging economies in China, India and the Middle East are boosting the de-mand for gold jewellery.

Political and economic uncertainty: When fears arise, as they did post-Sept 11, the enduring value of the world’s oldest currency takes on a new luster.

Reasons Why Gold Prices Could Go Further Up

It is safe investment since it has less volatility and lesser risk; it looks forward to bear markets and follows a bot-tom-up approach of stock-picking. There are 3 broad types of funds present in the market when it comes to in-vestment strategy namely, growth, blend and value. This depends on the fund manager whether he is ready to buy popular or expensive stocks or is seeking to discover cheap stocks, betting that the market will discover them, too. Each type of fund will give different results; it depends upon the investor to decide in which type of fund it will invest in. In today's article, we will see what value fund is all about.  

Value Fund : Often investment experts say that, value funds are good option for the beginner investor. Value fund is a mutual fund that invests in those stocks that are undervalued in the market. The fund will buy stocks from companies that they think are sound, but are presently unpopular and low-priced. The fund will then hold onto the stocks until they increase in value and the end result will be better than expected results. The return on investment is hopefully quite significant, as once the market realizes that these stocks are under-priced, inves-tors will buy them, thereby forcing the particular stock's price to go up. Often these stocks pay a healthy divi-dend, even though they are currently undervalued in the market. These are the stocks that have fallen out of favor with mainstream investors for one reason or another, either due to changing investor preferences, a poor quarterly earnings report or tough times in a particular industry. Value stocks are often the stock of mature com-panies that have stopped growing and that use their earnings to pay dividends. Thus value funds produce cur-rent income (from the dividends) as well as long-term growth (from capital appreciation once the stocks become popular again).

These funds are considered as a conservative investment, because they slowly increase in price. These funds are suited for the moderate or conservative investor who does not have higher amount to invest but still want to make a mark in the mutual fund market. Expert opinion on Value fund are often regarded as safe investments since they have less volatility and hence have lesser risk but the earnings is also very less. Though historically speaking, value fund has greater risk, but with that risk, comes higher returns. The fees associated with these funds are lower, because the funds do not buy or sell stocks as often. The growth is at steady but slow rate. However, there are also chances that the stock picked by the fund manager do not grow as expected. The hold-ing period for these stocks can be high, as the fund manager needs to keep these in the portfolio until he feels the value is realized. The value of a stock can be made by its P/E ratio. The P/E ratio tells you how many years worth of current earnings it will take to earn back the cost of the stock.

Some fund managers hold large cap stocks so as to have liquidity in the portfolio. Financial experts advise that major portion of an investor's portfolio should remain in equity diversified funds as these funds are flexible and they do have value stock picking too. A value fund is a great way to invest in the capital market without risking everything on one or two stocks. Because they buy large basket of stocks, which has the diversity without need-ing to have large investment money to go with it. Generally a build up portfolio, value funds look forward to bear markets and follow a bottom-up approach of stock-picking. Value funds are profitable when they are invested in the bear market. The fund manager shall look for those companies whose stocks are traded in discount at a fair price and which provides margin of safety to the investors in the long term. It is one of the great ways to build the portfolio. Value funds are a good choice generally for many investors, because they "pay you while you wait." In other words, a company's stock may not go up much in value over a period of time but it will pay you a dividend in the meantime.

The above table shows that value funds have delivered descent returns for the timeframe of two and three years. In 1 year, Templeton India Equity Income fund generated double digit returns of 14% compound annual-ized compared to its benchmark BSE 200 which was 4.71% whereas, In 3 years, ICICI Prudential discovery fund generated close to 28% compound annualized returns against its benchmark S&P Nifty which stood at 12%.

In short, it is important to compare different value funds before you choose one for yourself and should look at the long-term rate of growth on the fund. - By Gautam Arora

Value fund is a good option for conservative investors looking for long-term growth

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 Registered. No. : KOL RMS / 419 / 2011‐2013           

The Anna Hazare-led movement has caught the imagination of the Indian population, specially the youth. These developments are keeping the UPA government on its toes and no one knew what the next move would be, as the government is making one blunder after another. I get the impression that it is in complete disarray and does not know how to tackle the situation.

On the other hand, global events are continuously hampered the market sentiment. After the US downgrade and the Euro zone growth numbers for Q2 suggest that there is more bad news in the offing. And the world is looking at things defensively. Germany and France, which are the strongest and largest economies amongst the Euro zone countries, have reported poor growth numbers. Even Italy and France, the third and fourth largest nations in the Euro zone, facing huge problem of piling debt, they are in a group heading for a period of slower growth in the world economy. Moreover if history is a guide; then the odds that the US economy is falling into a double-dip recession have risen sharply lately .All this would in turn mean that there would be lower demand for basic metals and other commodities, including oil. This would keep the prices of basic metals low globally. I feel that Indian companies from steel, aluminum and copper to underperform on the bourses in the coming months, as they would see their realizations and their output take some thumping. On the other hand, Indian oil marketing companies should do well on the bourses, as they would be bearing a lesser subsidy burden due to falling crude oil prices. It makes good sense to go for the Oil and gas companies.

A major event that took place recently was the dethroning of Reliance as India's most valuable company by Coal India. I expect the race to maintain and regain the covert position will only get hotter and more contenders will come into the picture.

The Last month which was very much action pack with various rumors flowing from all around the corners. Market started talking about 4100 or 3900 for Nifty however I don't believe in creating rumor rather believes in making understand about the possibility of what can happen or the possibilities seen going ahead. In my last article it was clearly said that below 5200 Nifty somehow gets into the range of 5200-4800 on the extreme range as of yet. 5300 will act as the immediate resistance for Nifty. No need to be over bearish. Its a buying opportunity on any good decline but buy in a systematic way in good quality blue chip stock. Since then just one day it closed below 4800 where it made low of 4720 and closed at 4747 and from there it went on to hit 5150 and those who bought at lower levels gained around 15% in various equities. Last month FII's also sold around to the tune of Rs 11400 crore in equities (prov) however this time in the last 6 trading ses-sion FII's have net bought to the tune of Rs 2972 crore and if on a continuous basis the buy fig crosses Rs 3500-4000 crore then it will be considered very positive for the market which will indicate further upside. As of now 5200-5300 will be acting as a good resis-tance for Nifty. Only continuous closing above 5300 will make it further strong where the range becomes 5300-5600 else 4800 on the downside and below 4800 the last good sup-port stands at 4573-4529 level. Only a closing below 4500 will make it deep weaker.

Now lets have a look at the various world indices. US market very much performed as per the given levels where Dowjones made low of around 10600 where the support was given at 10600-10300, even Nasdaq, S&P & Dowjones Transportation index very much per-formed as per the given levels.

Brazils's Bovespa recovered 21% from the recent low it made as it saw a sudden interest cut.

Shanghai which is still under pressure has some support around 2475 and on the upper side faces resistance at 2700, a closing above 2700 will indicate fresh upside for Shang-hai.

European Indices looks oversold on charts and can hope for a good bounce back.

Technical View on CAC, France Market@ It has so far corrected around 30-31% from its year top. Got excellent support in the region of 2881/2849 from where we can expect a bounce back. Below that it could see level of upto 2750/2702-2534

Technical View on FTSE, London Market@ It has so far corrected around 21% from its year top, corrected quite less compared to its other peers. Got excellent support in the region of 4851/4838 from where we can expect a bounce back. Below that it could see level of upto 4714-4561.

Technical View on DAX, Germany Market@ It has so far corrected around 32% from its year top. Got excellent support in the region of 5077-4987 from where we can expect a good bounce back.

FTSE MIB which is index of ITALY has almost reached somewhat near to its major sup-port area which is around 12895 that's the max downside I see and it has all possible chance of bouncing back somewhere ahead of it.

I personally feel that everyday is not a trading day, there're some time when we find great value and for that one even may need to wait. Technical analysis helps in the getting the proper level which helps getting in proper levels, sort of bottom fishing in good quality stocks.

Double Dip or buy on Dips….!!! (Part –II) - Manish Bothra

Editors View as He sees it - Samir Kothari

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