07th Jan 2012:

Euro tumbles against dollar to 16 month low and nearly 11yr low against Yen hurting Japanese export oriented stocks. Crisis in Euro spreads over smaller countries after Hungary 10 yr bond reaches 10% earlier European markets ended lower lead by Banks after investors were skeptical of Euro Italian 10 yr bond move above 7 % Banks ability to raise capital.

France sold 7.66 bln Euro worth long term debt in the markets average yield of 3.99 % reflecting concerns of France may loose triple A rating.

Asian Markets are cautious ahead of the U.S. Crucial employment report.

Back home trading volumes continue to be low despite Nifty trading above 4700 levels.

Nifty closed at 4754 and Sensex at 15868. Indian markets rallied more that 2.5%. Midcap and small Cap indices gained 2.2% & 3% respectively. Tata Motors closed higher by 14%, Ril Infra 11%, Icici Bank 10%, Lnt & Tata Steel 9%, Ranbaxy & Cairn 8%. Hero Honda lost 9%, Dlf 4%, Bajaj Auto 4.5%, Acc and Ntpc closed down by 3% & 2%.

Technically speaking Nifty have bounced back from its recent low of 4531 to make a high of 4795 in the week. If we look at the Fibonacci Theory from the high of 5399.7 to the low of 4531 levels. Nifty closed slightly above its 23.6% retracement levels. In the week Nifty made higher top and higher bottom pattern, But still the pattern is not complete. If Nifty closes above 4800 levels, then we might see higher levels till 4850-4863- 4900 levels. If the trendline is broken (Marked in Red) then we might see some higher tops.