Daily Outlook for Jan-16-2008

NSE Nifty(6074.25):Broad based selling took the Nifty as well as Sensex down by over 2% for the day. In fact, just as we had pointed out Monday's pull back turned out to be a vain attempt by bulls. Unless the markets bounce of a key support, it wouldnt be surprising if Nifty headed even as far down as 5300. The signs for such a deep correction would be when Nifty closes below 5900 - which would be a close below the rising wedge formation. Our regular readers were cautioned well ahead on Jan 10th to adhere to strict stops and as such should have little to worry. The support for Nifty are at 5964 and 5829 and resistance comes in at 6225 and 6300.

First it was Nikkei in August, then it was Dow Jones in November and now Hang Seng with yesterday's close below 26k has entered a primary down trend. UK's FTSE too is with in hair's breadth of entering into a primary downtrend(some may even consider that yesterday's close has put it in a bear market already). Hence, i would advise traders to exercise extreme caution in the coming days and weeks as it remains to be seen how long India and China can remain shielded from what's happening in the other parts of the world.