Tech stocks find favour again

Deepak Sahijwala & Sanjay R Bhatia

After a brief correction amidst high volatility the market has resumed its upward journey, as traders and speculators continue to build speculative positions in the Old Economy and tech stocks ahead of the Q2 results. FIIs continued to remain net buyers, using every decline as an opportunity to buy into stocks. Incidentally, mutual funds were also net buyers after a long time.

The Sensex faced resistance at the 4474 level. Even though, it moved above this level to touch an intra-day high of 4487.05, it failed to sustain and has since fallen below the 4474 level. It is once again going to test the 4474 level, and if it manages to move and sustain above this level, initially for four trading days, followed by 12 trading days, then the markets are likely to move into a fresh bull zone. And all this could well be triggered by the ensuing Q2 results.

CMC

The CMC stock moved in a range of Rs 73.90, touching an intra-day low of Rs 465.10 on September 25 and an intra-day high of Rs 539 on October 1. The stock managed to move above its 200-day moving average, which is a positive sign and augurs well. Even though, it moved above both its resistance levels of Rs 492 and Rs 525, it has slipped below the Rs 525 level due to profit booking but has continued to stay above the Rs 492 level. If it moves and sustains above the Rs 525 level for four trading days it is likely to test the Rs 594 level. On the downside, the Rs 440 level continues to remain an important support level.

Digital GlobalSoft

Digital moved in a range of Rs 71.40, touching an intra-day low of Rs 507 on September 25 and intra-day high of Rs 578.40 on October 1. It has not only moved above its 200-day moving average, which augurs well for the stock, but has also managed to move and sustain above the Rs 557 resistance level. Now, it is important that it continues to stay above this level for the upward trend to continue. On the upside, it is likely to test the Rs 600 level in a few trading sessions. On the downside, Rs 505 is an important support level.

HCL Technologies

The HCL Tech stock moved in a range of Rs 19.50, touching an intra-day low of Rs 160 on September 25 and an intra-day high of Rs 179.50 on October 1. Though HCL moved above the the Rs 178 level, where it faced resistance, it failed to sustain above it. It is once again going to test the Rs 178 level and if it sustains above it, HCL Tech is likely to test the Rs 195 level. On the downside, Rs 158 is an important support level.

Infosys Technologies

Infosys moved in a range of Rs 304, touching an intra-day low of Rs 4,315 on September 25 and an intra-day high of Rs 4,619 on October 1. The upward trend has continued. It is likely to test the Rs 4,800 resistance level in a few trading sessions, and if it moves and sustains above this level, it is likely to test the 4,872 level. On the downside, the Rs 4,010 level is a crucial support level.

NIIT

NIIT moved in a range of Rs 16.20, touching an intra-day low of Rs 137.10 on September 25 and an intra-day high of Rs 153.30 on October 1. It is now likely to test the Rs 160 level, if it succeeds in moving and sustaining above this level it is likely to test the Rs 174 level. On the downside, the Rs 137 level is an important support level.

Satyam Computer

Satyam moved in a range-bound trend of Rs 14.50, touching an intra-day low of Rs 241.70 on September 26 and an intra-day high of Rs 256.20 on September 30. It is likely to test the Rs 260 level in few trading sessions, and if it manages to move and sustain above this level initially for four trading days followed by 12 trading days, it is likely to test the Rs 291 level. On the downside, the Rs 230 level is an important support level.

Wipro

Wipro moved in a range of Rs 115.70, touching an intra-day low of Rs 1,162.10 on September 25 and an intra-day high of Rs 1,277.80 on October 1. On the upside, it is likely to face resistance at the Rs 1,418 level. On the downside, the Rs 1,100 level could act as an important support level.

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Nasdaq

The Nasdaq continued to witness selling pressure at higher levels, but failed to complete the 12-day cycle of staying above the 1832 level. Now, it will have to once again sustain above the 1832 level for the upward trend to resume and for it to test the 1930 level. On the downside, the 1760 level is likely to act as a crucial support level.