Attention shifting to tech stocks

Deepak Sahijwala & Sanjay R Bhatia

The markets continue to move in a lacklustre and rangebound trend with profits being booked at higher levels. Volumes however continue to remain low. While traders and speculators were seen booking profits at higher levels, FIIs continued to remain net buyers. Overall, the markets are likely to remain cautious ahead of the Q4 results and forthcoming elections. Stock specific action will be seen mainly in frontline tech and Old Economy stocks. Meanwhile tech stocks are likely to witness hectic activity on the back of a slew of announcements of bonus issues and stock splits from Infosys, Wipro and Mphasis BFL along with news of strategic investments by Infosys in the US.

Technically, the benchmark BSE Sensex has sustained over the 5550 level for six trading days, which is a positive sign. Now, it is important that it stays above this level for another six trading days to complete the 12-day trading cycle. On the upside, the benchmark BSE Sensex was able to move above its resistance level of 5816 but failed to move above another resistance level of 5935 and now it has fallen below both these levels. Technically, it is important that the Sensex once again moves and sustains above the 5816 level for it to test the 5935 level. While on the downside, the 5550 level is likely to act as support level.

CMC

The CMC stock has moved in a range of Rs 70, touching an intra-day high of Rs 560 on April 5 and an intra-day low of Rs 490 on April 6. Even though, CMC was able to move above the Rs 550 level, it failed to sustain above this resistance level. Now, it is important that it moves and sustains above the

Rs 550 level for any fresh rally to begin. On the downside, the Rs 428 level is likely to act as an important support level.

HCL Technologies

The HCL Tech stock has moved in a range of Rs 28.80, touching an intra-day low of Rs 254.70 on April 5 and an intra-day high of Rs 283.50 on April 6. The stock was able to move above its resistance level of Rs 255, which is a positive sign. It is likely to test the Rs 294 level, which is likely to act as a resistance level. On the downside, the Rs 247 level is an important support level.

Infosys Technologies

Infosys has moved in a range of Rs 905, touching an intra-day low of Rs 5,040 on April 5 and an intra-day high of Rs 5,945 on April 6. In fact, Infosys was able to rally smartly on the news of an announcement of a stock split or bonus issue on April 13. But profit booking at higher levels has seen these gains disappear. The announcement and results on April 13 would decide the future trend for Infosys. On the upside, it is likely to face resistance at the Rs 5,398 and Rs 5,651 levels. On the downside, the Rs 4,836 level is an important support level.

NIIT

NIIT has moved in a narrow range of Rs 10.50, touching an intra-day low of Rs 184 and an intra-day high of Rs 194.50 on April 6. On the upside, the Rs 208 level is likely to act as a resistance level. On the downside, the Rs 170 level is likely to act as an important support level.

Polaris Software

Polaris has moved in a range of Rs 11.85, touching an intra-day low of Rs 182.50 on April 5 and an intra-day high of Rs 194.35 on April 7. On the upside, the Rs 201 level is likely to act as a resistance level. If it moves and sustains above this level, it is likely to test the Rs 211 level. On the downside, the Rs 176 level is an important support level.

Satyam Computer

Satyam has moved in a range of Rs 24.20, touching an intra-day low of Rs 305.70 and an intra-day high of Rs 329.90 on April 6. On the upside, it is likely to face resistance at the Rs 321 level. On the downside, the Rs 288 level is likely to act as an important support level.

Wipro

Wipro has moved in a narrow range of Rs 114.65, touching an intra-day low of Rs 1,327.15 on April 5 and an intra-day high of Rs 1,441.80 on April 6. Wipro too has announced that it would consider issuing a bonus issue on April 18—this would again impact the future trend for Wipro in the near future. On the upside, it is likely to face resistance at the Rs 1,632 level. On the downside, the Rs 1,360 level is an important support level.

Nasdaq

After last week’s rally on the Nasdaq, profit booking has set in at higher levels. It has continued to stay above the psychologically important 2000 level, which is a positive sign and augurs well for the future. On the upside, the 2091 level is likely to act as resistance level. On the downside, the 1994 level is likely to act as an important support level.