Nifty: Resistance at 5230, Support at 5000 says Dilip Bang

In the previous fortnight, expectations of various policy measures drove the markets in major economies. The Federal Reserve at its Federal Open Market Committee Meet announced its plan to expand Operation Twist, a programme through which short-term bonds are sold for the same amount as long-term bonds, and extend it up to the year end. The Fed reaffirmed that further action will be taken, if necessary. Moreover, economic recovery continues to be abysmally slow as the weak US data shows.

Although fears of Greece breaking away from the Euro zone were put to rest following the elections, high Spanish bond yields continue to be a cause of concern.

Domestically, the RBI at its monetary policy review kept key rates unchanged, considering inflationary pressures are continuously weighing on the Indian economy.

Also, problems due to the depreciating rupee persist. While a correction in the oil prices seems to be a good sign as it will lead to a reduction in the current account deficit, its impact on inflation will only be visible once the rupee shows signs of appreciation.

The Nifty has an upper-side resistance around the 5,230 level. Once it breaches this level, it is likely to touch the 5,520 level, thereafter. It also has support around the 4,950 5,000 levels. Investors and traders can look at taking positions either around the support levels or when the resistance level breaks.

Market participants can consider stocks like Century Textiles & Industries (LTP: Rs 296.85), Bharat Petroleum Corporation (LTP: Rs 763.50), Hindustan Petroleum Corporation (LTP: Rs 336.15), State Bank of India (LTP: Rs 2,177.95), Dena Bank (LTP: Rs 97), ICICI Bank (LTP: Rs 850.55), Reliance Infrastructure (LTP: Rs 535.20), Reliance Power (LTP: Rs 99.10), Strides Arcolab (LTP: Rs 759.45) and Larsen & Toubro (LTP: Rs 1,372.75) from trading and investment perspective as they look good on declines.

Source: Nirmal Bang's Beyond Market

Click here to read the full magazine

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.