WEEK GONE BY
As indicated in my last Weekly Report, Nifty just managed to surpass its previous high of 5181 by just one point, and failed to post a close above the said high, and closed the week at 5117, up just 8 points. In the process, nifty also managed to avoid a negative close for the week by 8 points. Nifty traded during the week almost in the trading range indicated by me, by trading in the range of 5051-5182 against 5010-5190 indicated in the last report. The low of the week of 5051 was recorded on Monday, and the high of the week of 5182 was touched on Friday. Nifty has now posted a close above 5100 for 8 out of the first 9 trading days of this month, indicating a 'broader distribution' before a steep fall.
WEEK AHEAD
Having succeeded in avoiding a negative close last week just by a whisker, Nifty is now all to post a negative close for the week ahead, and the closing for the next week will be below 5050. The trading range for the week will be 4980-5140.
STRATEGY FOR THE WEEK
1. I had asked those holding longs to get out of longs when nifty touched 5180, and in fact nifty gave an excellent opportunity to book profits in longs at its peak. If still holding, get out of the longs when you see 5130 in this week.
2. Those who are holding shorts can continue to hold the same with a reduced Stop Loss of 5183 nifty closing basis. But do note to book profit in shorts once nifty spot falls below 5000, so as to re-enter the shorts at a higher level later.
STOCK RECOMMENDATION
My recommendation for stock this week is EVEREADY INDUSTRIES as my multibagger pick.
EVEREADY IND - FV 5 - CMP 68. Equity 36.34cr. The company after 2 years of net loss, has posted a 19.4cr N/P for the year 03/09, and has posted multifold jump in Q1 at 16.05cr & Q2 at 17.54cr. Expected EPS for year 03/10 is Rs 9 on a face value of 5. My target for this stock is 100/150/300 in 6/12/36 months. A definite Multibagger in 2/3 years. Buy this stock in multiples of 200, sell 50% when the price doubles, and keep the balance 50% for very long term.
OPTION RECOMMENDATION
My Option Recommendation for the week is SUZLON call option 85CA.
BUY* Suzlon 85CA (cmp 3.95) below 2.50 for a target of 7.
* Pl note to trade in options only out of any trading profits due to inherent risk involved in option trading.
ANNOUNCEMENT
Our paid blog Kadiyali Options Blog will cease to be a paid blog w.e.f.1.1.2010. The access to the options blog from the said date however will be restricted to our Nifty SMS Group members on complimentary basis. The existing members of the blog will be treated as members of our Nifty SMS Group upon renewal, and complementary access will be issued to them to options blog. Similarly the existing members of our Nifty SMS group will also be issued complementary access to the blog against any vacant slots on the basis of their date of joining.
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