Nifty will be 4-5% up on Friday? Yes, in-line with global market we will move higher but we doubt its sustainability.

Indian market will follow-up with the global sentiments which was +ve yesterday. Asian/ European markets were up 4-6% and Indian market need to catch up on Friday. With inflation coming down, one can expect some fresh buying in FnO segment.

In cash segment we don’t see any strong trigger for buy. Long term investors must abstain from fresh buying. One can get better opportunity in near term. After 30-40% fall in Oct’08 alone, markets were expected to jump 10-15% which is happening now. Don’t read too much into this pull back, as of now ultimate trend is downward only.

The outlook for the coming session is that of guarded optimism, should the overseas markets stay firm. Expect the domestic sentiments to improve. Long-term investors should buy only if the stocks which he/she is buying still at low price.

Since the Indian Markets are expected to open up with gap-ups of 3-4% and move further higher, hence.......

1. Traders should not go long on Nifty future, instead wait and see how other Asian or European market are behaving, in case if you see weakness in those market like if they are flat or below 1% up or in negative zone then build fresh SHORT position on Nifty just before the market closing.
2. Similarly Option traders should look for above signal to go Nifty PUT.

Wall Street was feeling more upbeat on Thursday after a government report showed the economy contracted in the third quarter by less than expected and after the Federal Reserve's second interest rate cut in a month. The major stock indexes jumped more than 1 percent, including the Dow Jones industrials, which rose 100 points.

- HBJ Team