Daily Outlook for Jan-25-2008

NSE Nifty(5033.45):Markets completly surrendered the opening gains to finish the day down by over 2% on the Sensex and 3% on the Nifty. The quality of this rally attempt is what everyone should pay attention to, namely, Sensex/Nifty response at previous support levels that are now acting as resistance. As can be seen from the chart above, yesterday's sell off has come right off the November lows on Sensex. A sell off that has come when almost entire Asia and Europe were rallying. It is still early days, but for the bullish camp, this is not a melody. Next, we would like to see the market action, if and when we trade around lower regions of the weekly trendline that has currently arrested the fall. In an ideal world, a retest of those levels should happen within a few weeks. The support for the Nifty are at 4769 and 4448 and resistance comes in at 5300, 5404 and 5564.

For the benefit of our readers, we would like to share here what good money management can do in any market condition. The words of one of our most recent client here and there is another one here from one of our long standing client.