mkt ahead...nifty 04th nov 2010

on monday, after the huge gap up opening and and maintaining the gains through the day it was suspected that perhaps nifty might again challenge the breakout level 6152, coming up after making a low of 5937 on last friday.

yday's gap up and breakout close has taken it further away from a possibility of movement to the prev expected 5800 lvl on downside. the trading volumes were not quite satisfactory. however there are imp resistances on dow near 11300 and on nifty slightly above 5200. so, if its just a bounce or fresh rally difficult to say at the moment.

there was also a falling wedge type pattern on nifty eod charts which was broken out from on monday. if correct then it has min lower tgt 6243 and min upper tgt of 6340, somewhere near the lifetime high. its a buy on dips for short term but the sl is quite deep from here.

we are still in the euphoria zone and till now no major surprises on earnings front, so only a slight increase upgrade on nifty eps can be seen, which has slightly lowered the rapidly rising valuations, but still in that overexpensive zone.

as we know that liquidity pumping in the euphoric situations can take the mkt to much higher levels than anticipated, so whenever the lifetime high of year 2008 is broken on large volumes, the long term tgts can be as high as 6700/7000 .i.e 10% higher.